Cambodia awaits digital currency rollout

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Cambodia is still awaiting the rollout of its digital currency, after reports from the country’s central bank earlier this year suggesting it was preparing an imminent launch of the technology.

Back in early 2020, the National Bank of Cambodia said it was launching a digital currency, powered by blockchain, in the first quarter of the year. However, moving into Q3, there is still no sign of the digital currency, known as Bakong.

Earlier in the week, the bank’s director-general Chea Serey was quoted by The Phnom Penh Post saying that Bakong had been launched in testing in July, and is expected to be up and running by the end of the quarter. This would imply a new deadline of September 30 for the currency to be in widespread use in the country.

Serey noted that the project had already secured the backing of a number of partners within the Cambodian banking system.

“Bakong will play a central role in bringing all players in the payment space in Cambodia under the same platform, making it easy for end-users to pay each other regardless of the institutions they bank with. Eventually, we hope to allow cross border payment through the Bakong system too.”

Amongst the banks to be adopting the digital currency at the outset is Phnom Penh Commercial Bank. Bank president Shin Chang Moong said the digital currency will ultimately improve Cambodia’s financial and payment systems.

“Some are concerned that banks might lose some of its market share to Bakong. This is partly true, at least in the short term. However, our industry is relatively immature in terms of the number of service providers and users. Bakong will eventually create financially inclusive ecosystems that all the stakeholders in the industry can benefit from.”

The news comes as other regional powers, including China and Japan, are reporting progress in their own drives to establish and launch digital currencies.

To learn more about central bank digital currencies and some of the design decisions that need to be considered when creating and launching it, read nChain’s CBDC playbook.