Pi Pay founder Pokorny outlines the future of the Kingdom's fintech – Khmer Times

While Cambodia’s fintech industry is dominated by payment service institutions, the industry is ripe for disruption, according to Pi Pay Plc founder Tomas Pokorny.
Pi Pay first entered the Cambodian market in 2017, becoming one of the first firms to offer e-wallets in the Kingdom. It merged with Smart Axiata Co Ltd subsidiary Smartluy Plc last year.
There are only about 2.65 million debit cards in the country and 5.22 million e-wallets, according to Mekong Strategic Partners report citing pre-pandemic figures. This suggests that financial inclusion is largely being driven by fintech companies such as Pi Pay and TrueMoney rather than traditional commercial banks.
Pokorny, who is also board director for the Cambodian Association of Finance and Technology, said while the pandemic had heightened the adoption of cashless payments, its potential lay far beyond the payment services and e-wallets.
He told CamEd Business students that almost every aspect of commerce, from logistics to back-end services, will require fintech services in the near future.
“In Cambodia, the industry is currently dominated by payment providers but I think that in two or three years from now, you will see Cambodian startups and Cambodian fintech go much more into the financing, regulatory and payment infrastructure side of things,” he explained.
Pokorny noted there are more than 300 active fintech startups in Cambodia and highlighted this was a disproportionately high number of businesses for a country with as small a population as Cambodia.
Noting the challenges in credit scoring, Pokorny stressed that electronic know-your-customer (KYC) will be used to help banks make smarter decisions.
Already, firms artificial intelligence (AI) lending platform companies such as Upstart Holdings Inc are offering its services to American commercial banks and the company claims that its learning algorithm has 75 percent fewer defaults while approving the same amount of lenders using traditional KYC methods.
In Cambodia, some forward-looking banks are believed to be pursuing similar arrangements with AI lending platforms as well.
“Consumers, businesses and entrepreneurs will be looking at using data to making smarter choices when investing. Proper modelling will help understand how economic factors influence investment decisions towards better credit scoring. It will be important to look at how AI and machine learning will influence lending and lower the cost of lending for companies,” said Pokorny.
“We will likely see more optimised institutional lending, probably more decentralised peer-to-peer models and, while it is not allowed, I believe crypto assets will be floating around and we will be allowed to use it,” he continued.
Pokorny told students he believes data coupled with data-driven verticals will be one of the most lucrative sides of the fintech industry.
Pokorny said: “I do not believe that Cambodia will be fully cashless in the next five years, I do not believe we will be even remotely close to where China is – not with AliPay and their banking technology. We will definitely see more cashless transactions but Cambodia will experience a more traditional blend.
“Increased acceptance of digital payments is driving increased digital penetration in the country. People may not realise it but digital acceptance of commerce and solutions is almost as important as the journey to financial inclusion… granted e-commerce is not as omnipresent in Cambodia like the US with Amazon or Alibaba in China, but pretty much everyone in Phnom Penh has bought something on Nham24 or FoodPanda.”
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