The Cambodian digital currency, bakong, managed by the National Bank of Cambodia (NBC), has expanded its utility through an agreement with Alipay. This collaboration, formalized via a memorandum of understanding (MoU) at the FinTech Expo in Singapore, will integrate bakong with the Alipay merchant network. Through this partnership, users will access cross-border transactions on Alipay+ using QR codes.
Bakong, although operating on a blockchain by the NBC, differs from a central bank digital currency (CBDC) as it’s a liability of the commercial banks employing it. It supports both United States dollar and Cambodian riel accounts, catering to the heavily dollarized Cambodian economy.
The MoU signifies that Cambodian users can utilize riel from their bakong wallets to shop among 83 million global merchants linked with the Alipay network. Moreover, Chinese tourists holding accounts with China’s expansive Alipay system will be able to make purchases in Cambodia by utilizing QR codes through the bakong KHQR system.
NBC governor Chea Serey highlighted the convenience of these transactions, stating, “The simplicity of making payments provides merchants with a revenue boost, helping to stimulate economic activity. I’m confident this collaboration with Alipay+ will be beneficial for all parties.”
As reported by the Phnom Penh Post on Nov. 17, the bakong facilitated 35.4 million transactions worth $12 billion in the first half of 2023. Launched in 2020, bakong was initially designed for remittances and purchases. Its mobile app was a joint effort with Japan’s Soramitsu blockchain.
Recently, Soramitsu announced intentions to use bakong for constructing a cross-border payment system involving India, China, and Japan. Bakong is already operational in Malaysia, Thailand, and Vietnam, showcasing its growing reach and potential in the region.