Perceptions and Determinants of Credit Service Utilization among Residents: A Case Study of Kratie Province, Cambodia

Abstract

Aims: This study examined the perceptions and factors that determine the use of credit services by 111 farming households in Kampong Cham commune, Sambour district, Kratie province, Cambodia. Method: Data collected from four villages (Ampil Teuk, Samphin, Ajen, and Tansong Thleak) showed that respondents had moderate understanding of credit services, with the strongest understanding of benefits and trust in financial institutions, but little understanding of credit terms, repayment terms, and associated risks. The main factors affecting the decision to borrow included family encouragement, lack of personal funds, flexible repayment terms, and ease of applying for credit, while interest rates and repayment terms had a lesser influence. Common problems included difficulty understanding credit contracts, insufficient access to financial data, and poor repayment plan design. Results: The results of statistical analysis using one-way ANOVA showed that there were statistically significant differences in understanding and experience between income levels and villages, while occupation, education level, and age did not show statistically significant differences. However, gender showed statistically significant differences in understanding and challenges. The reliability of the research instrument was high (Cronbach’s α value between 0.81 and 0.90; overall α value = 0.86). Conclusion: The results of the study highlight the need to implement specific financial education programs to increase understanding of credit terms, repayment management, and risk awareness, as well as to promote credit services that are more dignified and flexible to encourage responsible borrowing and strengthen financial resource capacity in rural Cambodia.