Reports
ទំព័រដែលរួមបញ្ចូលគ្នានូវសកម្មភាពហិរញ្ញវត្ថុ មិនមែនហិរញ្ញវត្ថុ និងសង្គមរបស់អិលអូអិលស៊ី
LOLC Cambodia has been involved its activities in Environmental, Social, and Governance since LOLC Cambodia wish to be part of the solutions toward climate change. We understand that financial sector has a vital role to play in responding to social and environmental challenges. By the way, such efforts require every stakeholder’s involvement such as:
- Lenders as funding support,
- LOLC Cambodia as financial provider, and
- Clients as the one who demand those environmentally products
For supporting sustainable development of the government as well as to be part of the solutions toward climate change, LOLC Cambodia has put its effort by embedding in the loan process for the key points to address the concerns on Environmental, Social, and Governance.
With the acknowledgement from the management and Board on the key roles of this unit to play in tracking, monitoring, measuring, and reporting the outcomes that LOLC Cambodia has been involved and implemented, the Board has approved to enlarge the scope of the Unit and renamed from SOCIAL PERFORMANCE MANAGEMENT UNIT to be SUSTAINABLE MANAGEMENT UNIT.
Key Role and Responsibility of SMU
• Lead development of LOLC’s long-term Sustainability Management/ESG strategies and company-wide SM/ESG policy, including standards of conduct for employee.
• Ensure LOLC policies and practices comply with CPP and other ESG standards.
• Track, monitor, and report related to ESG.
• Gather and disseminate ESG best practices/learning materials that improve LOLC’s ESG.
• Work to continually improve the staff’s ESG awareness and strengthen staff capacity, design, develop, and implement ESG orientation courses for new staff and periodic workshops for existing staff. Ensure that LOLC staffs are well updated on changes related to ESG strategy.
• Collect and analyze company/client/industry data to promote firm transparency and measure ESG improvement.
• Develop and conduct an annual ESG assessment and prepare an ESG report for publication and dissemination.
• Make recommendations to LOLC management and BOD based on the ESG assessment’s findings and implement policy/procedural changes as necessary.
Achievement in 2022
LOLC Cambodia has an exclusion list which prohibits the financing of activities with a negative impact on the environment and community. LOLC has in place robust measures to prevent loans being granted for any excluded activities. All loans are assessed by field staff and reviewed by supervisor against exclusion list and on the social and environmental assessment.
Environmental and Social assessment was implemented with all loans.
• For loans which are lower than USD 30,000, the environmental and social awareness are discussed with clients on risk areas and give suggestions for improvement.
• For Small and Medium Enterprise loans (SME) which are bigger than or equal to USD 30,000, a comprehensive tool is fully integrated into the lending process.
The detail assessment is conducted to evaluate whether the impact is low, medium or high, and suggest to client for the awareness and improvement. As an ongoing implementation the progress of environmental and social assessment is monitored. From January to December 2022, 308 loans were assessed.
Below graph shows the numbers of risks areas on the assessed loan whose business types are exposing to different areas of environmental risks such as:
- Environment [E],
- Environment, Health and Safety [E and H&S],
- Health & Safety [H&S], and
- Labor [L].
In conclusion, LOLC customer outreach doesn’t fall in high risk exposure.
LOLC Cambodia has disclosed of the client rights in its website, on plastic folder which every customer is given with the loan documentation.
At least two times (during assessment and before disbursement), clients were informed about the product’s features, fee charges, cooling off period, terms, and conditions by using visual aids (A4-Metacard). In addition, the video guideline of using visual aids A4-Metacard is disclosed in LOLC’s website.
LOLC Cambodia was assessed by Microfinanza Rating (MFR) for the CPC in November 2021. As the result, in February 2022, LOLC received the Gold Level of Client Protection Certificate from Cerise and SPTF and the certificate is secured by February 2025.
First certified CPP certificate from SMART Campaign which assessed by M-CRlL in July 2015.
In 2018, underwent check-in review by M-cril as the result that next validity was till 2020.
In February 2022, LOLC received the Gold Level of Client Protection Certificate from Cerise and SPTF.
1. Appropriate Product Design and Delivery:
LOLC Cambodia offers unsecure loan, secure loan, leasing, saving, and convenience repayment (through agents), and multiple choices of currency (Riel, Dollar, Bath) and repayment options. The client repayment capacity is strictly assessed at client’s business area/home.
2. Prevention of Over-Indebtedness:
All loans are conducted rigorous repayment capacity by FSA and reviewed by HSFA and/or BM before approval. Credit Bureau Cambodia (CBC) checking, closely monitor PAR, Internal Audit team monitors verifies loan appraisal actuary, compliance with CMA lending guideline. The loan was approved when client has capacity to repay.
3. Transparency:
Key facts documents are given to clients such as repayment schedule, transparency sheet, loan contract, all documents are in Khmer that contains the loan information, total loan amount, pricing, including all fees, APR/EIR, disbursement date, loan term and due dates of all repayment installments. At least two times (during assessment and before disbursement), clients were informed about the product’s features, fee charges, cooling off period, terms, and conditions by using visual aids (A4-Metacard). Client’s right and telephone hotline are also confirmed to clients.
4. Responsible Pricing:
Consistent the industry wide practice of offering a range of interest rate for a product. The loan and saving pricing depend upon the competition and they are reviewed regularly by research team. Staff is not allowed to charge over the product pricing range.
5. Fair and Respectful Treatment of Client:
The Code of Conduct (CoC) incorporates LOLC Cambodia’s mission, core values, professional conduct expected from the employees and prohibited action. All employees agree to abide by the CoC by singing the declaration, implications of violating the CoC, loan recovery process including Do&Don’t activities are also trained to staff. The way of staff reacts or serves client including aggressive sale technique and misleading information are checked and verified by supervisor checklist.
6. Privacy of Client Data:
The privacy policy is in place which is clearly mentioned in Credit Operation Manual. Client was asked for consent before collection their information, photo, and sharing it to CBC or third party. Moreover, the client privacy agreement is in place to maintain the confidentiality, security, and accuracy of clients' personal, transactional, and financial information.
7. Complaint & Resolution Handling Mechanism:
LOLC Cambodia has the Complaint & Resolution Handling Mechanism which the client can provide their complaint or feedback via many channels (suggestion box, telephone hotline, direct verbal, email, website, Facebook). Telephone hotline is managed by Contact Centre team at HO and the hotline number is shown on the counter, repayment schedule, loan plastic folder, and other marketing materials. All complaint and feedback are response properly and comply with the regulation. The clients understand about their right such as the right to get the related information, important documents, refuse to get the product, the right of data privacy, the right of complain or feedback, and the right to be served without any discrimination.
financial education awareness potential channels including:
1. In-class training,
2. Mass Media (Facebook),
3. Marketing materials, and
4. Other Campaigns.
Past Achievements
• Finlit in-class tainting: 57,409 (76% or 43,435 females) of clients, non-clients, university students and kids were trained.
• Finlit awareness banner: 75 banners were designed and produced that mentioned about financial education key messages and installed at potential places.
• Radio program named “Idea for growth”: the program aims to deliver the financial literacy message, consumer protection, and self-motivation to rural people.
• Finlit awareness video: videos were produced to deliver the financial literacy messages to public/clients.
In 2020, due to Covid 19, financial literacy awareness in-class training and other related activates were postponed and 24 short financial literacy videos were produced and posted in the popular mass-media Facebook page and LOLC Facebook page. As the result, as of December 2022, the videos were reached by 16.08 million people.
One Village One Product Project (OVOP): In 2022, LOLC provided Financial Education awareness on “How to Get the Right Financial Services” to 1,170 OVOP’s beneficiaries in Kampong Cham, Kampot, Siem Reap, Takeo, Bantay Meanchy, Sihanoukvill, Battambang, Phnpm Penh, Kampong Chhnang, Svay Rieng, and Odor Meanchey.
Financial Education Awareness Training Modules:
is part of the LOLC contribution to society that its branches operating. There are activities such as road maintenance, bench instalment at public space, school activities, tree planting, books for library, well, clean public space…etc. As the result in 2022, there are
sponsor or contribute to support social activities such as, the Covid-19 crisis supporting, anti-drug leaflet, donations to customers, fresh milk nutrition program, and people affected by flood, etc.
Support fund to Youth of Community: contributed to Youth for Community to assist in humanitarian activities to reduce poverty and family hardship.
Red Cross Cambodia: LOLC: LOLC made an annual donation to the Cambodian Red Cross as a social to support humanitarian activities in society on the occasion of the 159th Anniversary of World Red Cross and Red Crescent Day, under the theme "Together with the Cambodian Red Cross to solve challenges and continue to strengthen community resilience."
Federation of Association for Small and Medium Enterprises of Cambodia (FASMES): to support FASMEC in building a successful business activity to project’s beneficiaries related to financial education awareness on “How to Get the Right Financial Services?”.
9th Cambodia Book Fair 2022: to support 9th Cambodia Book Fair 2022 under the topic “A Day Reading, A Day More of Understanding” to promoting the reading, writing, and publishing industry in Cambodia.
Anti-drug leaflet: contributed to social work by handing over 80,000 leaflets on drug issues and other promotional materials to the General Secretariat of the National Authority for Combating Drugs in order to disseminate information on drug issues to the people through the Capital Drug Control Committee City/Province, District, Commune, and Ministry Member of the National Authority for Combating Drugs.
CSR at PSN: ខេត្តព្រះសីហនុ ថ្ងៃទី ២៥ ខែធ្នូ ឆ្នាំ២០២២៖ អិលអូអិលស៊ី បានឧបត្ថម្ភគ្រឿងឧបភោគបរិភោគ ធុងសម្រាម និងសម្ភារសិក្សាមួយចំនួនជូនចំពោះអង្គការកុមារឃ្លាំងលើដែលមានទីតាំងស្ថិតនៅសង្កាត់លេខ២ ក្រុងព្រះសីហនុ ខេត្តព្រះសីហនុ។ អ្នកស្រី កែវ សម្រិត អ្នកគ្រប់គ្រងទូទៅរបស់ អង្គការកុមារឃ្លាំងលើក៏បានមានប្រសាសន៍ឱ្យដឹងថាអង្គការកុមារឃ្លាំងលើបានបង្កើតមកនៅឆ្នាំ ២០១៣ និងបានជួយកុមារជាច្រើនឱ្យទទួលបានការបណ្តុះបណ្តាលលើជំនាញផ្សេងៗរួមមាន៖ ភាសាខ្មែរ ភាសាអង់គ្លេស របាំ ការយល់ដឹងអំពីសុខភាព និងការផ្គត់ផ្គង់ជាអាហារមួយចំនួនផងដែរ។ អ្នកស្រីបានបន្ថែមទៀតថា អ្នកស្រីមានសេចក្តីសោមនស្សរីករាយជាខ្លាំងដែល អិលអូអិលស៊ី បានចូលរួមគាំទ្រ និងឧបត្ថម្ភនូវគ្រឿងឧបភោគបរិភោគ ធុងសម្រាម និងសម្ភារសិក្សាផ្សេងទៀតជូនមកក្មេងៗ ក៏ដូចជាសម្រាប់អង្គការកុមារឃ្លាំងលើបានប្រើប្រាស់បម្រើប្រយោជន៍រួមសម្រាប់សហគមន៍យើងឱ្យកាន់តែបានច្រើនជាងមុនបន្ថែមទៀត។
In order to establish baselines for the measurement of LOLC’s efforts to reduce our environmental impact, LOLC started tracking system for resource usage such as electricity, water, gasoline, and diesel. The results are given under their respective headings below and will be used to benchmark our future performance.
Currently, LOLC is offering Green Lending both leasing and loans through its existing products such as Financial Leasing (FL), and Life Improvement Loan Asset-Backed (LILAB). LOLC got technical support from ResponsAbility and the tools to measure the impact of Green Lending on CO2 emissions and energy saved. LOLC was chosen as the outstanding MFI in providing Green Lending in early 2021. As of December 2022, there are almost 5K clients are using Green Lending Product, for a gross loan portfolio, Of US$ 14 million and LOLC has support to decrease the CO2 emission, 74,989 tCO2 through green lending.
LOLC has served clients with WASH Loan products since 2016. The WASH Loan helps clients to improve water access, sanitation and hygiene in their communities. Target clients are those in good standing with LOLC who want to build or renovate a latrine, well, pond digging, water storage or buy a water filter, etc. As of December 2022, there are 5.4Kclients are using a Wash Loan product, with gross loan portfolio of US$ 4million.
LOLC offers Home Improvement Loan (HIL) to their clients who want to fix or renovate their existing house since 2016. In 2019, LOLC has developed a new convenience product called Housing Loan (HL) for the clients who want to build or buy new house. As of Dec 2022, LOCL is offering HIL and HL loan to 9.8K clients of USD 57.8 million gross loan portfolio.
Female Clients: 70.24% (borrowers)
Rural Clients: 78% (borrowers)
Client involved in Agriculture: 46.88% (borrowers)
PPI
PPI Proxy
Analyse Portfolio Breakdown by Client’s Poverty Level For such analysis, the client’s income is required to keep proper records in the core banking. However, with the current limit of digital data, the analysis of client concentration by its likelihood of poverty level which is benchmarking from Poverty Probability Index (PPI) definition, LOLC uses the average loan size as a proxy for poverty ranking classification as per below table.
Secure Loan &Unsecure Loan
Financial Inclusive
Tax Amount for 2022: Implementing ESG in Cambodia, there is no tax incentive yet at this point; by the way, LOLC can show its well compliance to tax requirement [receive award from GDT/PM]
Tax amount Finance Report
In the interests of fiscal transparency, we are pleased to publish our consolidated tax paid report in the table below. (TBD)
Business Ethics: the well-developed code of conducts and its strong implementation by their staff. An employee’s conduct both within and outside the workplace will affect LOLC’s professionalism and reputation. Therefore, all employees must strictly abide by LOLC’s code of conduct. In addition, LOLC complied with CMA lending guidelines.
Independent directors: 2 Independent directors
Summary List to Reflect with ESG and SDGs
LOLC (Cambodia) Plc. has been serving Cambodian public and society for over 29 years, and has been recognized by both local and international financial authorities. Our products and services are committed to improving the livelihood of Cambodian customers.
#666B, Street 271, Kbal Tumnub Muoy Village, Sangkat Boeng Tumpun 2, Khan Mean Chey, Phnom Penh, Cambodia.
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