A new investigation by the media outlet Follow the Money has linked cases in Cambodia where debt stress from microloans preceded suicides or attempts, while European-backed lenders maintained top client-protection certifications. The reporting names several European development financiers, including Norway’s state development fund, Norfund.
The Follow the Money article alleges that Norfund and other major European investment firms invest money in the Cambodian Hattha Bank, which then uses the money to lend to poor, illiterate farmers in the Cambodian countryside. These loans often come with high interest rates and drive the farmers into poverty and financial ruin, which has led some to suicide.
According to the article, Hattha Bank received a USD 20 million loan from Norfund in 2021. The investigation also notes that LOLC, another Cambodian lender with European backing that includes Norfund, maintained a gold-level client-protection certification after a review. Both institutions were cited in borrower testimonies described by the reporters.
Norfund stated it takes reports of borrower suicides “extremely seriously,” and that it evaluates client protection independently of certifications during due diligence. Other European development agencies named in the article provided similar statements on oversight and the role of certifications.
The investigation further describes how certification standards are used in the sector and details changes in 2024 to the Cerise+SPTF framework. Cambodian cases referenced in the report involve high legal interest ceilings, alleged abusive collection practices, and language and literacy barriers for Indigenous borrowers.
