HRW: Debt Traps predatory microfinance

Human Rights Watch report dated 24 September 2025, titled “Debt Traps: Predatory Microfinance Loans and Exploitation of Cambodia’s Indigenous Peoples,” documents predatory lending by Cambodian banks and microfinance institutions (MFIs). The report states that MFIs which received foreign investment have engaged in predatory lending and collection practices, ensnaring millions of Cambodians in debt traps and leading to forced land sales, loss of means of subsistence, child labour, reduced food consumption, and debt suicides. The report states that in 2019 Cambodia became the country with the most microfinance debt per capita in the world. It states that by 2024 the value of microloan debt had more than doubled over five years, with the country’s 3.8 million households holding more than 3.1 million microloans worth more than US$18 billion, and that the average loan size of over US$5,800 was more than 4.2 times the country’s annual median per capita income of US$1,400 in 2023. The report cites World Bank data showing household debt reached 34.4 percent of Cambodia’s GDP in 2021, compared with 15.8 percent in Brunei and around 10 percent in the Philippines, Sri Lanka and Indonesia. The report focuses on Ratanakiri province, where Human Rights Watch interviewed 56 Indigenous residents and community leaders, 52 of whom had microfinance loans collateralised with land titles, and states that MFIs in northeast Cambodia have accepted “soft titles”—informal documents from local authorities overlapping with Indigenous collective land title claims—endangering protection processes. It describes credit officers coercing borrowers to sell land outside formal procedures.