Legal and Tax Updates

Legal Update: Prakas on Conditions for Bancassurance Business of Banks and Financial Institutions

Issue: No. 018P/21 – 09 April 2021

On 30 March 2021, the National Bank of Cambodia “NBC” issued the Prakas No. B7-021-105 Prokor on Conditions for Bancassurance business of Banks and Financial institutions “Prakas”. This Prakas covers all Banks and Financial Institutions “BFI” under the NBC supervisory authority. Below is the key summary of the Prakas which composes of 05 (five) chapters and 16 (sixteen) articles.

Purpose of the Prakas

The Prakas is to set forth regulatory framework for Bancassurance business of BFI aiming at enhancing the financial inclusion by increase accessibility of insurance services to the public, and strengthening consumer protection.

Coverage of the Prakas

This Prakas is applicable for all banks and financial institutions under the NBC supervisory authority hereinafter referred to as “Institutions”.


Bancassurance refers to a mechanism by which the institution and insurers collaborate to distribute and market insurance products through institution network.

Bancassurance Business refers to provision of insurance products by Institution on behalf of an insurer without involving any products development. Institution is allowed to undertake either referral model or corporate agency model, of which the Institution could get commission but no risk participation.

Eligibility Criteria

  • Obtain prior approval (no objection letter) from the NBC; (detailing in article 5 of this Prakas)
  • Have a good financial conditions and strong corporate governance as rated by the NBC at least for the last three consecutive years; and
  • Fully comply with prudential regulations of the NBC.

Annual fee

Before January 15 of each year, the Institution approved to as act as corporate agent shall pay annual fee following:

  • For headquarter: KHR 4.000.000 (four million riels)
  • For each branch: KHR 2.000.000 (two million riels)

Operational Requirement and Consumer Protection

  • Institution willing to conduct Bancassurance Business shall put in place operational guidelines with requirements stated in article 9 of this Prakas.
  • For ensuring consumer protection, the Prakas impose to the Institutions to ensure of some conditions as mentioned in its article 10.
  • For monitoring the institutions, the NBC requires to the Institution to submit quarterly report: report on the performance of the Bancassurance business and Financial report, solvency report and liquidity report of the insurer. Audited annual report of the insurer shall be submitted by the Institution to the NBC no later than April 10.


In addition to the disciplinary sanction stated in article 52 and 55 of the Law on Banking and Financial Institutions, the NBC shall impose transactional penalties as follow:

  • Any Institutions failing to comply with obligation to report (article 11 of this Prakas) shall be subject to transactional penalty of KHR 1.000.000 (one millions Riels) per day.
  • Any Institutions failing to comply with this Prakas shall be subject to transactional penalty of KHR 3.000.000 (three million riels) per day counting from the date the NBC required the Institution to take corrective action.


To implement the above-mentioned Prakas to be more efficiency and effectively, the NBC has issued a letter dated April 06, 2021 to approved BFI in Bancassurance Business to delay the compliance requirements by following detail:

By this letter No. B7-021-602 Chhor.Tor on the Implementation of the Prakas on Conditions for Bancassurance Business of Banks and Financial Institutions for approved BFI, the NBC would like to inform that:

  • The approved BFI conducting through the Referral Model has been given additional period for the implementation of this Prakas and apply for renew their approval to the end of the year, 2021.
  • The BFI may also apply for the Corporate Agency Model.


The article is merely for general information purposes. It does not constitute a legal advice on the subject matter. If you have any question or need any assistance, please feel free to contact us:

SON Sokeng,


Managing Director


Sokeng has more than 8 years of professional experiences in corporate, commercial, investment and capital market sector in Cambodia. He has leaded a legal counsel team to advise and assist ACLEDA Bank Plc. in the process of listing on the Cambodia Securities Exchange (CSX). He has been a team member of a legal counsel team to advise and assist in the IPO process of Phnom Penh Autonomous Port (PPAP). He is currently leading a legal counsel to advise and assist in an IPO of a SME for its proposed listing on the growth board of the CSX.
MANN Channaro


Head of Banking, Finance and Capital Markets Practice Group





Channaro focuses on corporate and banking & finance over 10 years with Microfinance, Specialized, Foreign Bank branch and Commercial Banks. He has particular expertise in handling financing transactions, including drafting and processing loan documentation and security documents and other agreements for institutions. Channaro experienced with National Bank of Cambodia, Ministry of Commerce and other Authorities in Company Registration and Banking License. Channaro is a key person in providing legal advices to Boards of Directors, Merger Banking Committee and Managements’ Team, policies maker and an approver related to Banking products and services. He got the Certification on Certified Regulatory Compliance from the Institute of Banking and Finance.