Q&A with Governor, National Bank of Cambodia, H.E. Dr. Serey Chea
H.E. Dr Serey Chea
How did you get to where you are?
In high school, I was fascinated by the series The X-files and dreamt of exploring the stars as an astronaut. But I was advised that it is unlikely I would find a job in Cambodia with such a degree, and eventually ended up pursuing a major in accounting and finance at university. When I joined the National Bank of Cambodia (NBC) 25 years ago, I did not like the task I was assigned at first: I was to supervise microfinance institutions (MFIs). But a field visit of the MFIs clients changed my mind. Many would not have been able to send their children to schools or have a better living standard if they did not have access to initial funding from the MFIs. I realized I could help build up a livelihood and change someone’s life with regulations. So, I decided to stay with the Bank and helped introduce numerous regulations for the microfinance sector, making Cambodia one of the first countries in the world to do so. I subsequently moved up the ranks and spent 25 years of my life with the Bank. Having spearheaded diverse facets of central banking, I was last year nominated Governor of the National Bank of Cambodia.
What inspires you?
Improving lives has always served as my inspiration. The struggles to bring confidence in Cambodia’s monetary system were enormous given its turbulent history, and I was part of this confidence-building process! We now have a vibrant banking system and digital payment landscape. We even introduced one of the most sophisticated forms of money in the world: money on Blockchain. Bakong system, an internationally recognized payment system, is a Blockchain-based system, which allows peer-to-peer money transfers. Changing people’s lives in the way they make payments while standing out on the international payment stage inspires me and allows me to wake up early and go to work with a smile on my face (even if I am not a morning person).
What is your advice to the younger generation?
Find a role model who can guide you on your journey. Stick to your idea, and only let go when you have reached your destination. Continuous learning and self-improvement are keys to growth, so never settle for the status quo and always strive to better yourself. I completed my master’s when I was pregnant with my second child and my PhD during Covid-19. It is also crucial to listen to different perspectives when making decisions. Despite having no IT background, I led a team of IT specialists to successfully set up the Bakong system. Be decisive in your actions, even in the face of stereotypes or biases that may exist. Embrace failure as a natural part of learning and use setbacks as opportunities for growth. Lastly, ask for help when needed. Seeking support from others is a sign of strength and wisdom.
How far do you think we have come in achieving gender equity in the world of finance?
There are two aspects to gender equity in finance: equity in the policy making and the users’ space. I am glad to see more women reaching policy making positions in central banks. In ASEAN, there are three female governors heading central banks in Cambodia, Laos, and Vietnam. But the numbers are still small globally. I strongly believe that female leadership brings unique understandings of challenges faced by women. While men often prioritize the economic viability of the measures taken, women are more likely to approach solutions with empathy and a focus on human-centered outcomes. In terms of users of financial services, Global Findex shows that the gender gap in account ownership across developing economies has decreased by 9% in 2011 to 6% in 2021. This indicates progress in women’s access to financial services. In Cambodia, more than 65% of micro, small, and medium enterprises are owned by women. While these developments demonstrate progress in gender equity in finance, considerable efforts are still required to tackle inequalities that hinder women’s economic opportunities.
Describe the role and importance of a regulator in ensuring fair and transparent financial markets.
Regulators should provide a conducive environment for market players to operate transparently and responsibly to all stakeholders, and not just shareholders and regulators. To do so, regulators need to address the supply and the demand side. On the supply side, adequate regulations, and their supervision and enforcement are important. But it is the adaptation of those regulations to the local context that are often challenging. Thus, continuous capacity building of supervisors through training is essential. On the demand side, consumers should know their rights and responsibilities to use financial products. As such, public awareness and education programs on financial literacy are crucial. In Cambodia, we have learnt that financial literacy is important to protect consumers from abuses. As such, the NBC collaborated with the Ministry of Education Youth and Sport to introduce a financial literacy program into general education for students.
In an ideal world, how would you shape global standards to ensure frontier, emerging, and developed markets have an equal voice?
Global standards are determined by institutions that allocate decision-making power based on capital contribution. This will inherently block frontier and emerging markets in having an equal voice. A good example of such an imbalance is climate change. The call for energy transition is welcome. However, many developing countries, who are among the least CO2 emitters, have urgent needs that focus less on energy transitioning, but more on climate change adaptation. They need bridges in places that are now flooded, new crops to adapt to droughts. Funding for these kinds of projects is unfortunately not factored in because it was not part of the “global agenda” to begin with, or if it does, accessing these funds is almost impossible. To ensure fairness, decision-making power should be more balanced between capital providers and those most impacted by the decisions. This approach would better serve the true intention of increasing economic welfare and promoting inclusivity in global governance.
What are the key emerging regulatory trends and how are you as an organization addressing these new risks to remain effective?
It is important to monitor emerging regulatory trends to effectively address new risks. Currently, we are tracking developments in ESG, Sustainable Financing, Crypto-assets Regulation, Climate Change, and Digital Transformation. Additionally, we understand the significance of data security, management, and privacy beyond cybersecurity and IT risk, and are implementing proactive measures in regulation to mitigate concerns. Our Policy and Supervision teams work closely with the private sector to stay informed about trends in the financial sector to ensure we remain effective in addressing new regulatory challenges.