PRASAC was a former credit component of PRASAC’s project funded by the European Union and implemented by three ministries of the Royal Government of Cambodia.

The project started in 1995 to rehabilitate and support agricultural sector in six provinces around Phnom Penh i.e. Kompong Cham, Kompong Chhnang, Kompong Speu, Takeo, Prey Veng, and Svay Rieng. PRASAC’s project phased out in December 2003.

To ensure the access to financial services to rural communities and micro-enterprises, PRASAC’s Project Steering Committee made a strategic decision to transform its credit component into a licensed MFI. In March 2002, the transformation was started by creating PRASAC Credit Association as credit operator registered with the National Bank of Cambodia (NBC).

In 2003, a trust fund called Cambodia Rural Development Foundation (CRDF) and PRASAC Staff Company were established to facilitate the transformation. With two initial shareholders, PRASAC was established by registering with the Ministry of Commerce as a private limited liability company in August 2004 and got its license from the NBC in November 2004 to legally provision financial services to rural communities and micro-enterprises.

To finalize its transformation, PRASAC started to identify and negotiate with investors since 2005 in order to replace the temporary shareholders i.e. CRDF. In 2007, PRASAC completed its transformation by replacing CRDF with new five shareholders such as BIO (Belgian Investment Company for Developing Countries), DGC (Dragon Capital Group Limited), FMO (The Netherlands Development Finance Company), LOLC (Lanka ORIX LEASING Company Ltd), and Oikocredit. Particularly, PRASAC received a permanent license from NBC in December 2007.