Loans Help Cambodia’s Family Farmers Cultivate Better Futures

HKL’s loans to Say Thon’s small farm have enabled her to increase its acreage and provide a better education for her four children. © HKL

Eighty square meters of land is about one-fifth the size of a basketball court—too tiny a plot, most would say, to start a profitable farm. But that’s all 67-year-old Say Thon could afford when she opened her vegetable business in Cambodia’s Kandal Pronvince. She had trouble raising the finance she needed because formal banks do not lend money to marginal businesses like hers. So she started small, on her own, and then approached IFC partner HKL Microfinance (Hattha Kaksekar Limited) for funding.

Mrs. Say Thon © HKL

After HKL loaned her $2,600 in 2013, she expanded her plot, set up overhead shade, and bought seeds and other inputs. As demand grew for her leafy vegetables and other produce, her yields rose. HKL stepped in again two years later, lending her a further $5,500 to install an irrigation system and make other improvements. Soon, Thon’s acreage tripled and her daily income doubled. “HKL’s strong support helped me produce more and earn more,” she says. “My living conditions are better and my four children are getting better education.”

Since 2015, IFC has invested $80 million in HKL—Cambodia’s fourth-largest microfinance institution—to help micro, small, and medium-sized enterprises (SMEs) harvest better futures for their founders and employees. There are currently more than 450,000 micro-entrepreneurs and about 27,500 SMEs across Cambodia, generating about 1.6 million jobs. Our involvement has allowed HKL to broaden its reach and serve a greater proportion of these entrepreneurs through a robust and well-established rural network.

IFC’s funding has also helped HKL increase individual access to financial services, reducing the number of unbanked citizens – especially low-income borrowers and agribusinesses in rural areas. The number of HKL’s loans is expected to grow to 154,000 from 100,000 by the end of 2017.


Growing Foreign Investment

HKL started in 1994 as a non-governmental organization focused on food security. It provided loans to poor farmers, especially women, and became a licensed microfinance institution in 2001. Its role is especially important because the majority of businesses in Cambodia are SMEs, and half of them cannot access formal banking. One-third of these Cambodian SMEs are agribusinesses.

Extending financial services through electronic and digital channels will allow HKL to lower costs and improve reach while better serving their customers. For example, customers using mobile products will be able to execute financial transactions such as mobile top-ups, bill payments, loan repayments, money transfers, and other financial services at any time it’s convenient for them.


A Loan that Goes Back to the Land

IFC’s loan contributes to Cambodia’s macro-economic growth by supporting HKL’s micro and small business customers—like Say Thon—while attracting much-needed foreign investment to the country.

Meanwhile, Say Thon is looking at expanding her acreage even further. “As I get more and more clients from local market and resellers, I plan to approach HKL for further financing,” she says.

To learn more about IFC’s work in Agribusiness, visit

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Published in July 2017


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