Big Data’s Potential to Aid Post-Pandemic Recovery

Big data and fintech adoption have the potential to transform Cambodia’s health, social and educational sectors and speed-up post-pandemic recovery, according to an ADB report.
Covid-19 has accelerated fintech adoption in Cambodia (Kiripost/Siv Channa)
Covid-19 has accelerated fintech adoption in Cambodia (Kiripost/Siv Channa)

While the Covid-19 pandemic has brought the potential of big data to the fore, it has also stimulated fintech adoption across Southeast Asia. In its latest publication, Asian Development Bank (ADB) examines the regional impacts.

Big data in post-pandemic Southeast Asia

‘Harnessing the potential of big data in post-pandemic Southeast Asia’, published in May, highlights the value of big data for health care, social welfare and protection, and education. It says, “Big data can support over $100 billion worth of opportunities across the five focus countries.” These are Cambodia, Indonesia, Myanmar, the Philippines, and Thailand.

The pandemic has presented Asian governments with fresh challenges, such as the cost of health spending, an additional 78 million households falling below the poverty line, and adding four million unemployed youth. According to the publication, “Big data can improve the delivery of government services during Covid-19 and speed up the post-Covid-19 recovery.”

Thy Try, executive director at Open Development Cambodia (ODC), told Kiripost that big data “can be used as an input in the formulation of policies, programs and development plans related to attracting local and foreign investors”.

The editor-in-chief of online hub ODC, which compiles with freely available open data, said,

“To respond to future outbreaks of disease, especially to address the negative impact on social, economic, educational and health sectors, big data improves social accountability and public services sectors at both the national and sub-national levels.”

The ADB study reveals that governments in the region can unlock the potential of big data through the use of remote monitoring systems in health care, analytics to direct highly-targeted health interventions, and technologies for personalized and remote learning as well as online job matching.

Technologies for personalized and remote learning as well as online job matching
Technologies for personalized and remote learning as well as online job matching

In Cambodia, the “IDPoor” digital database has been used during the Covid-19 pandemic to identify more than 560,000 poor households for the “Cash Transfer Program for Poor and Vulnerable Households during Covid-19”.

To support the design and delivery of social welfare and protection programs in Cambodia, “IDPoor” could be integrated with databases from National Social Security Fund and Ministry of Health.

Socioeconomic Impacts of the COVID-19 Cash Transfer Programme (Data: UNDP)
Socioeconomic Impacts of the COVID-19 Cash Transfer Programme (Data: UNDP)

Is Cambodia’s mobile payment built for ASEAN integration?

The ADB study said, “Cambodia Data Exchange (CamDX) is an important initiative by the Government of Cambodia to improve data collection and data sharing.” It added, “CamDX curates data from different information systems into a unified and decentralized data exchange platform to provide a secure and standardized way of accessing data.”

CamDX adopts the model of X-Road of Estonia, the backbone of e-Estonia that includes a full range of services for the general public. So far, CamDX, which is setup in the data center at the Ministry of Economy and Finance (MEF), supports Online Business Registration (OBR) and Validation Application on Payment Guarantee.

With the OBR platform, business owners can get an estimated approval time of eight days and a 40 percent reduction on the registration fee.

In the ‘Cambodia Digital Government Policy 2022-2035’, smart government is the stage where the collection and analysis of data are automated as a basis for decision-making and responding to problems.

To fully realize at this stage is when “innovation of digital government services using new technologies, such as artificial intelligence, the Internet of Things, Big Data, blockchain, and cloud technology”.

How Covid-19 has accelerated fintech adoption and growth

As Southeast Asian countries further embrace digitalization, it has accelerated the development of fintech firms. The region benefited from “leapfrogging technology” using mobile and internet-based solutions, according to a recent ADB publication.

It added that the Cambodian government’s “robust programs to develop e-money and digital banking solutions as the country experienced three critical waves of the Covid-19 outbreak was long overdue”.

Across Southeast Asia, the onset of Covid-19 has sped up digital transformation, particularly in fintech. “The Covid-19 pandemic has accelerated digital technology adoption in the financial sector and the role of financial technology (fintech) firms in supporting households and businesses during the crisis and beyond,” said ADB in its new book published mid-2022.

It added, “The Covid-19 crisis and related government responses will further stoke growth in digital financial services.” The publication went on to stress that “the value of mobile money transactions now constitutes a substantial part of the financial system, with transactions in Cambodia, Ghana, and Zimbabwe reaching more than 75 percent of GDP in 2018.”

Value of Mobile Money Transactions
Value of Mobile Money Transactions

In Cambodia, instead of disrupting the country's financial services, fintech is joining its development. With 13.44 million internet users out of the 16 million population, as of 2022, “the advancement of next-generation technology provides a level playing field for fintech firms allowing them to not worrying about inflexible legacy systems, (regulation) and siloed channels,” said Mekong Business Initiative in its report on fintech in Cambodia.

It concluded, “This has lowered the barriers to entry. Cost advantage is on the fintech side.”

According to the National Bank of Cambodia’s 2021 report, at the end of 2021, 13.6 million people were registered for e-Wallets and 46,278 agents were in operation. The total number of transactions were 195.3 million, with a total value of $25.1 billion. This accounts for 89.85 percent of the gross domestic product (GDP).

“Over 59 percent of Cambodians have adopted online payment transactions for online shopping activities, albeit still not as high as the value of ATM and cash transactions,” said a 2021 fintech report by Market Research Cambodia.

As a regional tech expert notes, Cambodia’s rapid pace of innovation and strong focus around financial inclusion makes it ripe for digital transformation.