Banking in Phnom Penh: How Foreign Landlords Collect Rental Income

Tenants can pay rent directly into a landlord’s local Cambodian bank account, or a property management company can collect the rent and forward it to the landlord’s overseas account. Phnom Penh’s banking sector has developed quickly, with a number of international banks already established in the city, and opening an account is generally straightforward. Where possible, it is worth a landlord opening a local bank account.

Which Bank Do Most Foreign Landlords Use?

Among overseas investors, ABA Bank is the most commonly used local bank. Founded in 1996, ABA has grown into one of Cambodia’s five largest banks, and account opening for foreigners is relatively convenient: it typically requires a valid passport with at least six months’ validity, and sometimes proof of a local address.

For landlords planning to keep larger deposits, some prefer to open an account with Union Commercial Bank (UCB), which typically requires a valid passport plus a work permit or business licence.

Cambodia’s Five Largest Banks

• ABA Bank — founded in 1996. Offers products and services for individuals and small and medium-sized businesses, with 50 branches, 100 self-service banking kiosks and 210 ATMs across Cambodia. Account opening for foreigners is relatively convenient. Website: ababank.com
• ACLEDA Bank — founded in 1993, Cambodia’s largest local commercial bank, headquartered in Phnom Penh with 261 offices nationwide as of the end of 2017, and more than 1.7 million depositors at that time. Its one-year US dollar term deposit rate reached as high as 4.55%, relatively high compared with peers. Website: acledabank.com.kh
• Canadia Bank — founded in 1993 and renamed Canadia Bank in 2003, one of Cambodia’s largest local banks, headquartered in Phnom Penh with a network of 57 branches offering a broad range of financial services. Its one-year US dollar term deposit rate reached as high as 4.75%, relatively high compared with peers. Website: canadiabank.com.kh
• Union Commercial Bank (UCB) — a Taiwanese-owned bank and one of Cambodia’s largest commercial banks. Founded in 1994, it became a wholly owned subsidiary of E.SUN Commercial Bank after E.SUN acquired 100% of its shares in 2017. UCB is headquartered in Phnom Penh with 13 branches. Account opening is relatively easy, requiring only a passport and a tourist visa; however, withdrawals are currently limited to the bank’s own ATMs, with no interbank withdrawal available. Website: ucb.com.kh
• Cambodian Public Bank — founded in 1992, with 30 branches. It is a subsidiary of the Public Bank Group, one of Malaysia’s largest and strongest domestic banking groups. According to a 2017 report by Cambodian Public Bank, it was among the commercial banks in Cambodia with the highest paid-up capital at that time. It has an extensive branch network and is popular with local residents. Website: cpbebank.com

Bank of China (Hong Kong) has also entered the Cambodian market, although it is not currently counted among Cambodia’s ten largest banks. As with most countries, Cambodia’s banking system is separate from other markets, so even a customer who already holds an account with the same banking group elsewhere must open a new account in person in Cambodia.

Opening an Account as a Foreigner

Cambodian banks generally hold accounts mainly in US dollars, with English- or Chinese-speaking staff available to assist customers. Canadia Bank was the first bank to also offer renminbi deposit accounts, with staff available at a dedicated counter.

To open an account, foreigners generally need:

• A business visa valid for more than six months
• Proof of address (such as a lease or a property purchase contract) or proof of employment (such as an employment contract)
• To apply in person at a branch with sufficient supporting documents
• A minimum first deposit of US$10 to US$20

An account can usually be opened the same day. If applying for a debit card, UnionPay card, Visa or Mastercard, the card is typically ready after ten working days and must be collected from the branch in person.

Term Deposits Can Offer an Attractive Return on Rental Income

Term deposit rates in Cambodia are generally higher than in comparable markets. For example, ABA’s rate has been as high as 3.75% a year and UCB’s as high as 3% a year. As banks’ online and mobile services have developed, term deposits, transfers, payments and mortgage repayments can now all be handled through a bank’s app, making it straightforward for a landlord to place rental income on term deposit while waiting for the property itself to appreciate — earning a return on both the property and the cash sitting in the bank.

Sending Rental Income Overseas

If a landlord does not hold a local Cambodian account, a property management company can collect the rent locally and transfer it to the landlord’s home bank account instead — though this comes at a cost. Quoted fees for outward transfers include:

ABA:

• Outward remittance fee: 0.15% (minimum US$15)
• Telegraphic transfer fee: US$15
• Intermediary bank fee: US$30–50
• Inward remittance fee: 0.1% (minimum US$10)

UCB:

• Outward remittance fee: 0.2%
• Telegraphic transfer fee: US$20

As in many countries, whether a landlord remits rental income through a local account or via a property manager, or sends a large sum of money overseas, their home bank may ask about the source or purpose of the funds. It is worth keeping all purchase contracts, lease agreements, receipts and other supporting documents on file.

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