GROWING TOGETHERWITH CAMBODIA

TABLE OF CONTENTSTABLE OF CONTENTS

03

CAMBODIA'S OVERVIEW

04

AGRICULTURAL SECTOR & MFI MARKET

05

MISSION & RESPONSIBILITIES

06

A MESSAGE FROM CEO

07

JCF BY THE NUMBERS

08

ORGANIZATION CHART

10CORPORATE GOVERNANCE

11

REPORTS OF THE COMMITTEES

12BOARD OF DIRECTORS

13

BUSINESS STRATEGY
Overview#1 Elaborating Agricultural Finance#2 Exploring the Potential of Primary Insdustry#3 Establishing New Credit Scoring Systemwith Digital Transformation

14
15
16
17

SUSTAINABLE DEVELOPMENT GOALS

18

CUSTOMER SURVEY

19

FINANCIAL STATEMENT SUMMARY

20

COMPANY PROFILE

21* "JCF" is an abbreviation of JC FINANCE PLC.

Annual Report 2021 03

Cambodia's
Overview
Name of Country

Kingdom of Cambodia

Total Area

181,035 sq km

Population

16,719K (2020, World Bank)

CapitalPhnom Penh

Languages

Khmer (97.05%), Minority Ethnic Group Language (2.26%)
Vietnamese (0.42%) (2013, NIS Cambodia*)

Religion

Buddhism (97.9%), Islam (1.1%), Christianity (0.5%) etc. (2013,
NIS Cambodia*)

Official language

Khmer

Laos

ThailandCambodia
Phnom Penh

Vietnam* National Institute of Statistics, Ministry of Planning, Cambodia

History and Geopolitics

EconomyPolitics

Relations with Japan

Based on Cambodia andChina's strong relationshipfrom a long time ago, theinfluence of China is blended
into Cambodia people's lives
despited the fact that bothcountries do not have directborder. Historically, China
has deepened its relationshipwith Cambodia with the aimof balancing relations with theneighboring countries such as
Thailand and Vietnam.

In recent years, the amount of
direct investment from China
has been remarkably increasing. It is said that more than
80% comes from China, andthe main fields are infrastructure construction, real estate,
resort development, garment
industry, etc. China’s aid engagement with Cambodia isalso the largest among othercountries.

Although the Hun Sen government has been going on
for a long time since 1985,
there are voices praising
the economic effects ofthe stable handling. Diplomatically, it espouses aneutral policy, however
its relationship with China
stands out with a strong
economic tie.

Basically, Cambodia is considered
to be highly pro-Japanese as
Japan played a major role in the
postwar reconstruction process
in terms of funding and humanresources. The good relationshipis based on popularization of highquality Japan-made consumer
and durable goods and the effort
of preparation of legal aspects
such as civil law and real estate
related laws support by the Japanese Government.

External Environment in 2021 (COVID-19 Pandemic)
From the end of 2019, COVID-19 spread across the world instantly
and caused a global pandemic. In February 2021, a large-scale
cluster occurred in Phnom Penh due to the action lacking
consideration of foreigners, and the infection rate and the numberof deaths had increased at an accelerating rate. However, since
May 2022, the number of new infections has remained at almost
10 or less per day, and according to an IMF country report issued
in December 2021, economic growth will gradually recover andmay exceed 6% by 2024. As for JCF, our customers, farmers, havebegun to overdue their loan repayments due to the deteriorationof the business environment such as the restriction of people’s

04 Annual Report 2021

movement and the stagnation of logistics, as well as theunprecedented drought and flood. The government also requested
financial institutions for support measures to their customers suchas exemption of delinquency charges and JCF has been providing
these measures. At the same time, we visited our customers asmuch as possible and carefully discussed “how to continue tomake repayment on time and keep a long-range good business
relationship in the future”. As a result, at the end of FY2021, as in
FY2020, we were able to reduce and control delinquent loans asmuch as possible.

Agricultural Sector
and MFI Market
As shown in the graphs, theagricultural sector, one of themain industries of Cambodia,
has a great potential. It is a
sector that can achieve theproductivity and quality levelcomparable to that of developed countries by investing
sufficient technology andfunds. Cambodia, with a population of 16.7 million, is alreadyattracting attention as a rice
exporter, and may be given an
important position in solving
the world’s food problems in
the future.

Comparing with Agricultural sector

GDP Transition

GDP and Agricultural GDP of Cambodia

Agricultural GDP of Cambodia

The agricultural sector share of Cambodia’s GDP is relatively declining due to the changes inindustrial structure. However the amount is gradually increasing. Dramatic changes can be
expected if technological innovation (such as implementation of Agritech,etc.) is realized in
the Cambodian agricultural sector.

Breakdown of GDP (2019) *1
Service

Number of Agricultural
Households (2019) *2

12.1% Others

38.85%
Industry

209,000
household34.23 %
Agriculture

20.71%

Approximately

USD

3.2

57.67%

Rice Farming

billion1,517,000
household*3Market of Microfinance (2021)
Financial Industry USD 37 billion

Banking sector
USD 30 billion

Microfinance Industry

USD 6.8 billion

87.9 % Rice Farming
Other
USD

Agricultural GDP accounts for about USD5.6 billion, which is about
20% of the total GDP, of which rice farming is about USD3.2 billion
which accounts for 57% of agricultural GDP. Approximately 90% of allhouseholds engaged in agriculture are rice farmers and in order tohave a technical and financial impact on the agricultural sector, it isconsidered efficient and effective to focus on the rice farming field andits related fields.

*1
*2
*3

0.2 billion
The financial sector is expanding with theeconomic development of Cambodia.
The business model of microfinanceinstitutions are not limited to the generalgroup lending but are diversifying into
various financing services and fields.

Source: JCF research based on NBC reports and others
Source: JCF research based on NBC reports and others
Source: National bank of Cambodia [Annual Report]

Annual Report 2021 05

Missionand ResponsibilitiesRESPONSIBILITIESFor Environment

For Customers

To maintain a sustainable natural environment (EcoSystem), we will
1. understand the principle of nature,
2. think about things from prosperous coexistence, and3. not exploit more than necessary from the naturalenvironment
We promise the above to our stakeholders and will makesocial contributions in a fair manner.

We are based on the principle of customer-oriented
operation (Fiduciary Duty), and aim to further improve
the quality of our financial services by promise to ourcustomers and business partners that we will
1. work for the benefit of the customer,
2. do our best with the expert knowledge and insights, and3. eliminate conflicts of interest both inside and outside
the company.

MISSION

VISIONJCF will contribute to the growthof Cambodian industries throughour financial platform in order toenhance the life of people.

JCF will aim to achieve rapid
growth of the people related
to JCF together, and to develop
leaders who will be responsible
for Cambodia’s growth.

VALUE

JCF will have the following 5 beliefs to achieve our mission and vision:
1. Value for Customer

2. Absolute Integrity

4. Keep Challenging

06 Annual Report 2021

3. Belief in Self and Brave
5. One Goal

A Message
from the CEOCEOTOMARI Suguru

Supporting recovery
and growth
The global pandemic of COVID-19, which started in the endof 2019, had continued as a serious issue around the worldin 2021. In Cambodia, The rapid spread of infection had
begun from April 2021 and the effects had been impacted to
all industries, companies and households was a challenging
time for each of us.
However, due to the leadership of the Royal Governmentof Cambodia, through strict regulations such as lockdowns
and quarantine measures and rapid vaccine campaigns, thespread slowed down. After the situation settled down, therestrictions had been lifted gradually since December 2021
across the nation and economic activities had resumed instages. Looking at the economic growth rate of Cambodia(IMF statistics),it slowed down to -3.13% in FY2020. However
it recovered to 2.15% in FY2021 and expected to be recovering more to 5.10% in FY2022 based on a certain scenario.
JCF obtained its license of Microfinance Institution from
National Bank of Cambodia in January 2018, and four terms
have passed after the fiscal year of 2021. Our mission is tocontribute to the growth of Cambodian industries throughour financial platform in order to enhance the life of people.
A major feature of JCF is that we not only provide financial
services to owners of small and medium-sized companies
as business funds, but also collaborate with them to create
new businesses. In particular, in the mid-term plan, we
aim to show a strong presence compared to other financial
institutions in Cambodia in terms of quality and quantity byproviding cutting-edge “Agricultural Finance” to customers.
JCF’s FY2021 performance, caused by the serious impact
of COVID-19, our customers and staff faced disruption of
the flow of people and logistics. However the amount ofloans disbursed increased significantly. and Our collection
team has suppressed the deterioration of the situation bystrengthening the collection through closer contact withthe customers. As a result, the full-year profit for FY2021
was $ 11K, we were able to keep profitability from previous
financial year. and in terms of the assets, the loan balance
increased by 13.2% compared to FY2020.

We were able to increase the loan disbursement amount as
the economic activities in Cambodia had resumed graduallyin FY2021, we had increased the loan disbursement amount.
However, Generating profit capacity was limited.Although
the impact of COVID-19 was a major factor of this result,the collection strategy should be reviewed and revised.
To summarize FY2021, I understand that the collection, adefensive measure, had been continued to be particularly
important.
In 2022, we will focus on the following three points toestablish the foundation for the next generation in order tofurther evolve our business strategy.
First, as the “JCF financial Platform”, we will support theecosystem related to the agricultural value chain in every
aspect. In other words, we will establish the field of “Agricultural Finance” and show unprecedented existence value.
Second, expanding the targeted industry. To date, our main
target was supporting the business of paddy rice farmers,
but in the future, we are considering expanding into otherprimary industries such as other farming crops and thefisheries and dairy farming. Third, we will build a new credit
scoring and monitoring system by coordinating with existing
big data.
I believe that the current global economy has passed theworst of COVID-19 and is gradually recovering. However,other uncertain downside factors in the economy, such as
climate change and geopolitical conflicts, are beginningto emerge and cannot be overlooked. JCF sees adversity
as an opportunity for growth and carries out reforming thecompany, and at the same time, we will never forget thevalue of “always staying close to our customers, growing
together, and sharing results”.
Last but not least, We would like to express our deep appreciation to National bank of Cambodia and our customers, staff,
business partners, shareholders and all other stakeholders
who have trusted and supported JCF.

Annual Report 2021 07

JCF bythe Numbers
LOAN OUTSTANDING BALANCETOTAL CUSTOMER & DISBURSEMENT

8,698

25,641
1,662

TOTAL ASSET & LOAN ASSET(%)

NET PROFIT

10,736

11

81%

PROFITABLE

08 Annual Report 2021

CAPITAL ADEQUACY RATIO

PAR90

54 %

247

(6,250)*Capital Included
under registration

2.84%

CUSTOMER ATTRIBUTES
Average loan
ammount

USD 16,475

2%Construction
Equipmemt 4 %Cash Loan

COMBINEHARVESTER

16%

Manufacturer ofAgricultural
Machinery
KUBOTA91%

GenderFemaleMale

3% 97%

Purpose of
the loan

Total of78 %rounds

TRACTOR10

Total of

1,043
supporters

Total amount raised

1% OTHERS
8% YANMAR

USD 1,428,159(JPY158,240,000)
Our funding platform of Japanese
agricultural cooperatives is supported
by many conscious investors in Japan.
As a result, we have raised a total ofmore than 150 million yen since 2020.

Annual Report 2021 09

Organization
Chart
Shareholders

The Board of Directors
Risk Management
Committee

Audit Committee
Management Directors
CreditCommittee
General Manager

Internal Audit

CreditCollection

Finance & Acc.

Auditor

Human
Resource

Sale Planning

CreditFinance
Accounting

Legal andCompliance

Administrator

Sale
Promotion

Credit Control

TreasuryBusiness
Development

CreditAdministration
RecoveryManagers

Soriya Lus

Vuthea Chea

YouYorng Yong

Kimpheak LongInternal Auditor

Collection and Recovery Manager

Credit Manager

Financial and Accounting Manager

I had taken in charge of accounting at
first, currently, I am responsible for
audit and internal control processes.
My motto is “Respect yourself andothers”, and “Getting ready is the secretof success”. I try to work in positive way
every day for company and our future!

I am in charge of collection department.
I always try to embrace or embodies
the value of hard work, dedication,and the importance of building strong
relationships. I hope I am an importantpart of JCF, then I would give all to JCF
to be successful in all business in the
future.

My responsibility is team building incredit department. We should study
and update our knowledge to develop
new product in order to get our businessgoing forward. I am honored to work at
JCF, which I believe is the best company
that is invested by Japanese investors
to develop Cambodian economy bybuilding the income for our customers,
farmers.

My main responsibility is controlling andchecking all daily transactions related
to finance processes. My favorite word
is “Working toward my goals inspires
others around me to do the same and wewill success together”. I love to share myknowledge and experience with all JCF
colleagues as well as helping them tosucceed the goal together!!

10 Annual Report 2021

Corporate GorvernanceIndependent Director KATO Yuko
In 2021, the 2nd year of “COVID-19 disease”, we had continued to manage
governance by remote work. We had
implemented the online daily operation
as a fintech company before this pandemic struck the world. Thus, most of
the operation is going well forward.
Moving forward, now we are preparing
for the next period so that we can see arising sun, after overcoming the night of
COVID-19 together with all the stakeholders.
Overview of Cambodia in 2021, the report from the World Bank “Living with
COVID-19” which was issued in December 2021, forecast that core industries
such as manufacturing, kind of clothing,

What we did to make better
Since obtaining our microfinance license in 2018 from NBC, our delinquentloans were few and not a major threat
due to our rigorous credit screening process. However, the COVID-19 pandemic
significantly impacted the rate of thedelinquent. PAR90 became 3.82% at theend of June 2021 from 1.88% the samemonth of the previous year.

travel goods, shoes, bicycles, etc. andagriculture will support the recovery of
the Cambodian economy.

expanding our business focus and loan
portfolio to other primary industries as
explained in this annual report 2021.

However, our customers who live in rural areas and are engaged in agriculturalbusinesses are still struggling to recover
their businesses and incomes. Of course,
we will continue to stay with themthrough finance services, but at thesame time, we are updating our governance for those risks in two ways. One isenhancing the special task force team toresolve delinquency. This team also
grasps the actual demands and difficulties of customer’s business and life bycontacting and communicating withthem more frequently. Another one is

We are glad to show our potential ofsustainability, that we were able tomaintain profitability in FY2021. However, a lot of customers still live in toughsituations. All of the members of JCF including the BOD members and shareholders in Japan have never forgotten
them even though we could not visit
Cambodia as much as we could before.

For 2021
For recovering this issue, we formed an
additional task force team in September
this year. It is enhanced to resolve especially early stages of the delinquency.
Made a contact point satisfactorily,
and collected the information point ofdifficulty on the customer when andwhat. Finally, we could reduce PAR90
to 2.84%, and achieved a profit in the

What we will do to make better
Cambodia’s economy is expected tostart recovering at a brisk pace, and according to the IMF, the economic growthrate may start exceeding 6% again by2024.
We will contribute to the part of that
great recovery by providing financial
services. On the other hand, we should
not underestimate the continuing

We will continue to develop and achieve
our goals with all the stakeholders. We
appreciate all of your continued support.

financial result.
In addition, we have begun to strengthenorganization as well as human resource
system reforms. As a start new members
who are skilled in management joined ourteam. These new members together withthe members who have supported JCF
since its establishment will share the samephilosophy and bring a bright future for JCF.

For 2022

instability and the many problems that
may arise during the recovery period.
One of the lessons learned from the
COVID-19 pandemic is the importanceto understand who our customers are
and how our activities affect them, andreflect it in our services and operations
rapidly. The most important things
are staying close to our customers andcommunicating with them frequently.
For growth, for contingency, we will continue to strengthen our organization,
which we have been carrying out since2021, and develop the knowledge, skills,
and heart to bravely face this growth
and any shortage.

Annual Report 2021 11

Reports of theCommittees
To strengthen the governance, JCF has below committees
with different levels of managements to effectively control
the institution.

Audit Committee
Risk Committee
The Risk Committee is composed of four members
and chaired by Ms. Kato, an independent director,
with expertise in accounting, banking, auditing,riskmanagement and legal aspects.
The Risk Committee is responsible for; managing
credit risk, capital risk, liquidity and funding risk,
operational risk, compliance risk and other relevantrisks and reviewing economic and competitivemarket, political risk and others. In 2021, the Risk
Committee held four times meetings to review anddiscuss JCF’s business and operations.

The Audit Committee complies with a Prakas of
National Bank of Cambodia. The Audit Committee iscomposed of 3 members and chaired by Mr. Yamada,an independent director. The Audit Committee is
responsible for ensuring compliance with legal
and regulatory requirements and the information
provided to the public and NBC is clear, accurate
and reliable, and as stipulated in aforementioned
Prakas. In 2021, the Audit Committee held meetings
four times to review and discuss on matters relating
to JCF.

Remuneration and
Nomination Committee
Credit Committee
The Credit Committee is composed of threemembers and chaired by Mr. Kikuchi, Chairman of
the BOD. The Credit Committee is responsible for
ensuring that the credit policy is consistent with
JCF’s longterm objectives and corporate values,
checking whether JCF provides services truly
contribute to the customer’s business development,
checking whether JCF pursuit of appropriate profit
on the premise of securing soundness and others.
In 2021, the Credit Committee held meeting as andwhen necessary.

12 Annual Report 2021

The Remuneration and Nomination Committee
is composed of four members and chaired by Mr.
Yamada, an independent director. The Committee
is responsible for ensuring the remuneration
policy is consistent with the long-term objectives
and corporate values of JCF and overseeing the
remuneration of employees and making sure thatthey are all fairly rewarded for their contribution to
JCF’s performance.

Board of
Directors

菊池 育朗

KIKUCHI Ikuo

泊 傑

山田

泰平

加藤 侑子

Director, Chairperson

Director, CEO

TOMARI Suguru

YAMADA Taihei
Independent Director

Independent Director

April 1991
Joined ORIX Corporation

April 2009
Jointed Sumitomo Mitsui
Banking Corporation

May 2013
Joined Norinchukin Bank

April 2015
Appointed as Director of
MJI Enterprise Co, Ltd.
(Microfinance, Myanmar)

November 2002
Joined ABC Capital of ABC
Cooking GroupMay 2008
Appointed as Managing
Director of ABC Capital
January 2014
Joined Something Holdings
Co., Ltd.
Appointed as Executive Officer/ MD of Executive Office
January 2015
Appointed as Director of
SOMETHING HOLDINGS ASIA
PTE. LTD (Singapore)

June 2012
Moved to Cambodia to start a
new business
July 2015
Joined Luckland(CAMBODIA)
Co., Ltd. Corporate Advisor
March 2016
Supported Establishing JC
FINANCE PLC.
July 2018
Appointed as COO of JC
FINANCE PLC.

October 2015
Appointed as MD of
SOMETHING VIETNAM CO.,LTD.

December 2018
Appointed as Director, COO of
JC FINANCE PLC.

June 2018
Joined JC FINANCE PLC.
Appointed as CEO of thecompany

December 2020
Appointed as Director,
Chairperson of JC FINANCE
PLC.

February 2022
Appointed as Chairman of
the Board of Directors of JC
FINANCE PLC.

February 2022
Appointed as CEO of JC
FINANCE PLC.

May 2016
Appointed as CFO of
Integrated Methods Sdn Bhd
October 2020
Appointed as Chairman of
Investment Committee atAmara Capital PLC (Cambodia
SECC licensed fundmanagement company)

KATO Yuko

November 2016
Appointed as Chief Executive
Officer of MJI Enterprise Co,
Ltd.
October 2019
Appointed as Independent
Director of JC FINANCE PLC.

July 2021
Appointed as Director of
GO24 Pte Ltd (the Cambodian
leading superapp startup
known for Nham24 brand)
February 2022
Appointed as Independent
Director of JC FINANCE PLC.

Annual Report 2021 13

Business Strategy
Overview
Our business mainly focuses on the primary industry, especiallyon the agricultural sector. We have carried out our responsibility
as a financial institution to enrich the lives of agricultural
households, which account for 70% of the Cambodian population,
by supporting their traditional farming business and new
business model that can increase their incomes. Our current threemain business strategies are to realize “Agricultural Finance”,

1“Supporting Business Creation” and “DX/Credit Scoring”. Since theestablishment in January 2018, we have constantly updated ourstrategy by grasping changes in the natural environment, social
environment, and technological environment. As a result, we areconfident that our future strategy will be further refined and will
have a significant social impact on our business areas.

ELABORATING AGRICULTURAL FINANCE

Supporting every sector and all stakeholder by JCF financial PlatformJCF has provided a variety of loans not only for agricultural machinery, but also SME loans
such as for a manufacture of the first domestic products in Cambodia. In addition, JCF has
deepened relationships with local agricultural cooperatives as well.

2

EXPLORING THE POTENTIAL OF PRIMARY INDUSTRY

Expanding the financing product from small agricultural machineries to bigger
agricultural related facilities and fisheries
JCF has expanded the connection with dealers and provided loans for many kinds ofmachinery such as KUBOTA, YAMMER, JOHN DEERE, JAO CHANG, SOLIS. And joining the“Commercialization of Aquaculture for Sustainable Trade Project” launched by World
Vision International, to support fishery farmers by our finance service. And Started
supporting dairy industry value-chain in Cambodia by our finance service.

3

ESTABLISHING NEW CREDIT SCORING SYSTEM WITH
DIGITAL TRANSFORMATION

Establishing credit scoring analyzed from the integration of static and dynamic
information
JCF will utilize the dynamic data collected using GPS etc., as an important element ofcredit scoring that will be developed in the future to establish a new credit and settlement(payment) system.

14 Annual Report 2021

Business Strategy #1

ELaborating Agricultural Finance

JCF will be representing
New Agricultural Finance
Scheme of JCF financial Platform Constructed by allying with external partner

Japanese unique agricultural cooperative society called “Nokyo Platform” isthe model when building our businessstrategies and its core concept of “Cooperatives” is registered as Intangible
Cultural Heritage by UNESCO in 2016
due to its contribution to creative
solutions to various social issues. We
have set “Nokyo Platform” as one of
the standards to achieve in the Cambodian primary industry and have beenworking on establishing the Cambodian version of “Nokyo Platform”. This
platform has two functions to enhance
the prosperity of the primary industry: a trading function that handles

agricultural products and machines
and a financial function that handles
providing finance in various stages ofagricultural business. We aim to be partof the financial function , “JCF financial
platform”, that can comprehensively
provide loans (funds/ financing) to theentire value chain from production andwholesales to consumption. Currently,
the main focus is on financing for thefarming equipment on the producer
side, the farmers. However, along withthe development of the “Nokyo Platform”, it is our responsibility to expand
our business to cover the whole agricultural value chain to help transform thecurrent “fragmented tenant farming”
into “more sustainable industry”. In
order to achieve this goal, the quantity
and the quality of the alliances withexternal partners are important, andwe will not limit ourselves to domestic
players but actively support foreign
players, including Japanese players, tonetwork and help localize their activities. As a result, we are confident that
we can increase our financing opportunities and it will become a steppingstone to handle more of the customers’
and partners’ financial assets in the
future.

Annual Report 2021 15

Business Strategy #2

Exploring The Potential of Primary Industry

Exploring the Potentialof Primary Industry*GPS Setting before delivery

6

To date, we have provided financing forfarm equipment rather than consumer
goods. We are confident that by committing our funds to the business for
economic growth, our customers are
more likely to enrich their lives througheconomic reproduction.
Our main customers, the farmers,
obtain agricultural machinery suchas combines and tractors through ourfinancing and efficiently harvest thecrops grown in their fields. In addition,
they can undertake the farm workof other people’s fields. By doing so,they are starting a new business andgetting paid. In other words, this is “the16 Annual Report 2021

agricultural machinery sharing” andthe prototype of the matching businessamong the farmers. This new use of
agricultural machinery has triggeredchanges in Cambodia’s main industries,
agriculture, and primary industries andboosts economic growth. We plan toroll out these usages of financed funds
and successful cases to other sectors
in the primary industry. In emerging
countries, it is undeniable that there isa lack of technology and know-how ofdeveloped countries. It is the issue forthe entire primary industry, including
the fisheries and dairy. On the other
hand, developed countries like Japan

can solve their social issues, such as
the aging farming population and lackof successors, by exporting their knowhow to emerging countries. By doing so,
the intellectual property of humankind
will be optimized ultimately, which is an
essential point without even referringto the SDGs. Starting from agriculture,
we will expand into neighboring sectors
and evolve the credit know-how wehave cultivated so far to create new
business models together with ourcustomers. We are convinced that thisdisruption in the primary industry will
surely enhance the growth of the economy that was hit by COVID-19.

Business Strategy #3

Establishing New Credit Scoring System with Digital Transformation

Establishing Borderless
Credit Scoring System
We are actively integrating new technologies into the financial operation. There
are two major operations in financial
business: “credit” and “collection”. As
the issue related to financial inclusion
becomes an important topic, we havemade financial transactions with thecustomers who were not previously
covered by the conventional credit
method by evaluating the information/
data collected by utilizing a new digitaltechnology. To be more specific, we
re-evaluate the dynamic data collectedfrom the financed agricultural(farming)
equipment. We install a GPS into
the financed agricultural (farming)
equipment to capture and collect thedata of the location and the use of theequipment at all times. As there is acorrelation between the mileage of theequipment and an increase in the customer’s income, the data is used as partof the guideline for credit monitoring
and credit management. Also, to collectthe equipment as collateral, rapidly andaccurately, acquiring the location dataof the equipment is critically important.
In some cases, the GPS even stops
the engine remotely, which can be an
incentive for the customer to repay theloan and recover the collateral.
Henceforth, by combining this dynamic
data with conventional static data (IDnumber, address, family structure,etc.), it will be possible to perceive thebusiness opportunities considering thecustomers’ regional characteristics andtheir future life events. In other words,
this new credit scoring system gives
great contributions to the customers’Life Time Value (LTV). From a global
perspective, it can be said that theflow of the people and the logistics do
not remain within the border but are
already borderless. A customer credited
in Cambodia is earning income abroad
to use it as a source of repayment ishappening in reality. Credit and collection can no longer be evaluated ina conventional way. We are confident
that establishing this new credit scoring
system shall become the new trend in
the financial industry in the near future.

Annual Report 2021 17

Sustainable Development
Goals
TARGET 9 • 3

TARGET 9 • A

Approach to SDGs 2021
9th Goal

INDUSTRY,INNOVATION AND INFRASTRUCTURE

Activity and Progress in JCF
It’s been five years since theworld started working towards the Sustainable Development Goals. The COVID-19
pandemic is threatening
decades of development
gains, further delaying theurgent transition to greener,
more inclusive economies,
and throwing progress on the
SDGs even further off track.
There are still significant
challenges to Goal 9, to which
we at JCF are committed, andwe are still below 50% of therequired progress.

Expanding financial services in rural area
Provided loans
2020

2021

YoY

USD 5,502,970

USD 6,869,890(+USD 1,366,920)

People366

417(+51 people)

Village649

667(+18 Village)

Loan amount

JCF achieved to increase 3 outputs. At first, provided loan amount was increase from 5.50 million
dollar to 6.87 million dollar (+1.37 million dollar). Next, Number of people who JCF provided
Loans was increased from 366 people to 417 people (+51 people). At last, Number of Village whichpeople lived as JCF provided loans was increased from 649 Villages to 667 Villages(+18 Villages).

On the challenge of Goal 8“Since 2009, improvements in labor efficiency and a reductionin unemployment have been achieved worldwide, albeit with
regional differences.
However, the global economy stagnated again in 2019 Then, in 2020,
the impact was even more incredible, and by 2021, Cambodian
people were also suffering from restrictions on cross-provincial
movement and strict quarantine policies for those who tested positive for COVID-19. It has a particularly negative impact on the global
market’s temp worker, self-employed, and day labor sectors.

18 Annual Report 2021

JCF started contribution to this goal through the dissemination ofagricultural technology in two partnerships with Japanese agricultural machinery manufacturers YANMAR and ISEKI.
In addition to this issue, we also recognize from customer
feedback that it is important to conserve the culture and bond offamily, as well as economic growth. We believe that customer-firstmanagement will contribute to the SDGs too.

Customer
SurveyWe had interviewed 10 customers byrandom selection. On average, they
increased their income by USD 8,240.
And we found some other positive
impacts. However, we also heard thevoice that JCF should improve its
services and business for customer’s
future.

(Name)

Mr. LONH PEOU

Mr. DE HA(Gendar)

Male

Male

(Annual income approx.)(after)USD15,000 up / (before)USD10,000(after)USD 50,000 up / (before)USD30,000(Most recent loan amount)

USD 17,000

USD 21,900(Agricultural land holdings)

60 acres

22 acres

Farming, Tractor Service,and leasing a land

Buyer of cassava, rice and cashew,
and Tractor Service

When I visited an agricultural machinery
showroom to make my business easier, JCF‘s staff explained everything, which made us
feel very comfortable. The difficult moment
was when the machinery broke and needed
to be repaired. The cost is a bit high and I
couldn’t work using the machinery until I
finished repairing.

I was worried about repaying the loan properly and was not sure if I took out a loan from
JCF. However, thanks to the kindness of the
JCF staff who listened to me carefully, I wasable to make up my mind. And now, with thehelp of the JC loan, my income has increased
and I have a more stable life.

These days, the cost of fertilizer and gasoline
is higher than before. It affects our businessprofit. However, If the opportunity arises, I
would like to buy a new car to improve mylife.

My main job is to buy crops such as cassava
and rice and sell them. However, with a loan
from JCF, I have been able to offer my services
to cultivate the land for neighbors. In a few
months, I would have the possibility to buy a
new house that I have always wanted.

I do not know about the future of Cambodia,
but I will continue to strive to expand mybusiness and support my family.

Some agricultural products are exported
today. I believe that someday, the agriculturalindustry will support Cambodian development
by joining the global market more deeply.

(About business)

You and JCF

You and business

Future of the farming
business in Cambodia

Annual Report 2021 19

Financial Statement
Summary
We have completed fourterms since its establishment
in 2018. We would like toreport that we were able tokeep profitability in FY2021
based on the CIFRS accounting standard. FY2021 was ayear that was significantly influenced by external factors,
especially force majeuresuch as COVID-19 and theunprecedented flood. It goes
without saying that this year
caused great economic losses not only to our industry
but to all other industries.
Under such a difficult environment, we thank for the
support of all the stakeholders that a newly establishedcompany like us was able to“keep profitable” as we havecommitted initially.
For FY2022, we aim toachieve the financial goals
beyond FY2021 by greatly accumulating the loan balancethat we could not achieve in
FY2021 and further evolving
the collection method wehave established through the
COVID-19 situation.
We would like to thankour stakeholders again for
FY2021 and please look forward to our further growth in
FY2022.

Financial Statement Summary (BS)(USD)

(KHR'000)(USD)(KHR'000)

4,311,893

ASSETSCash and cash equivalents

1,851,719

7,543,903

1,065,981

Statutory deposits

100,000

407,400

100,000

404,500

Loans to customers

8,698,219

35,436,544

7,643,089

30,916,295

Other assets

44,631

181,828

80,200324,409

Property and equipment

15,20961,961

5,444

22,021Intangible assets

26,141

106,498

30,352

122,774

Total Assets

10,735,919 43,738,134

8,925,066 36,101,892

LIABILITIES AND SHAREHOLDER’S EQUITY
Liabilities
Borrowings

4,949,568

20,164,540

3,126,426

12,646,393

Amounts due to related parties

4,250,000

17,314,500--

Other liabilities

20,331

82,82844,220178,870

Minimum tax liabilities/current income tax liabilities

1,296

5,280

1,096

4,433

Total liabilities

9,221,195 37,567,148

3,171,742 12,829,696

Shareholder's Equity
Share capital

2,000,000

8,000,000

2,000,000

8,000,000--

4,250,000

17,000,000

Deposits for future capital subscription
Regulatory reserve

79,964323,288

69,804

281,957

Accumulated losses(565,240)(2,283,310)(566,480)(2,288,355)-

278,594

Currency translation reserves
Total shareholder's equity
Total liabilities and shareholder's equity-

131,008

1,514,724

6,170,986

5,753,324 23,272,196

10,735,919 43,738,134

8,925,066 36,101,892(USD)(KHR'000)

2021

2020
(USD)

(KHR'000)Interest income

1,266,246

5,151,089

1,301,355

5,305,624

Interest Expense(331,129)(1,347,033)(334,925)(1,365,489)

Net interest income

935,1173,804,056

966,430

3,940,135

Other operating income

68,841

280,045

60,244

245,614

Total operating income

1,003,958

4,084,101

1,026,674

4,185,749

General and administrative expenses(830,946)(3,380,288)(821,621)(3,349,749)

Impairment loss on loans to customers(147,341)(599,383)(103,529)(422,088)

Minimum tax expense(14,271)(58,054)--

Profit before income tax

11,40046,376

101,524

413,912Financial Statement Summary (PL)

2021

2020

Income tax expense--(13,844)(56,442)

Net profit for the year

11,40046,376

87,680357,470

Currency translation difference
Net comprehensive income (loss) for the year

20 Annual Report 2021

31Dec2021 31Dec2021 31Dec2020 31Dec2020-(147,586)-(79,023)

11,400(101,210)

87,680278,447

Company
ProfileCompany Name

JC FINANCE PLC.

Business Category

Microfinance Institution

Licene Number

M.F-85

Establishment

Junuary 17th, 2018

Representative

CEO TOMARI Suguru

Headquarters

No.56, Street 310, Sangkat Boeung
Keng Kang I, Khan Boeung Keng
Kang, Phnom Penh, Cambodia

Tel+855 (0)23 217 419

E-mailinfo@jcfinance.com.kh

Websitehttp://jcfinance.com.kh

Annual Report 2021 21

info@jcﬁnance.com.kh
http://jcﬁnance.com.kh/+855 (0)23 217 419