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Author: Sorn Chhorvyvatey

CGCC and Cambodia Chamber of Commerce (CCC) Co-organized a Workshop on “Capacity Building and Improving Financial Literacy of SMEs” in Kampot

Posted on by Sorn Chhorvyvatey

On 26th April 2024, Credit Guarantee Corporation of Cambodia (CGCC) and Cambodia Chamber of Commerce (CCC) co-organized a workshop on “Capacity Building and Improving Financial Literacy of SMEs” in Kampot province in collaboration with Kampot-Kep Chamber of Commerce with around 70 participants from Management and staff of Participating Financial Institutions (PFIs) and business owners in Kampot provincee.

The workshop was presided over by Oknha Dr. Hak Sovannarith, President of Cambodia Chamber of Commerce, chapter based in Kampot-Kep, Mr. No Lida, Deputy CEO of CGCC, Mr. Tith Kamrong, Financial Literacy Expert and Founder of Rithipul Company, and the presentations by representatives from Acleda Bank and AMK MFI as well.

Through this workshop, business owners gained more understanding of the benefits of credit guarantee and especially understand the readiness to obtain loans from banks and microfinance institutions, as well as understanding how to use loans responsibly and correctly and have the opportunity to practice and get feedback Improved feedback from trainers / experts on loan readiness.

CGCC Conducted Courtesy Visits and Met the Management Team of 3 Bussiness Associations

Posted on by Sorn Chhorvyvatey

On April 24 and April 26, 2024, CGCC team led by Mr. No Lida, Deputy CEO of CGCC conducted  courtesy visits and met the management team of Kampot – Kep Chamber of Commerce, Federation of Association of Small and Medium Enterprise s in Cambodia (FASMEC) in Kampot and Young Entrepreneurs Association of Cambodia (YEAC) Chapter Kampot-Kep.

The dialogue between CGCC and the three business associations provided the opportunity for both CGCC and the three business associations to learn about the business situation in the provinces and the challenges of the business owners in obtaining loans for working capital and business expansion through credit guarantee mechanism.

CGCC visits PFIs provincial branches in Takeo, Kep & Kampot to Enhance Collaboration on the Credit Guarantee

Posted on by Sorn Chhorvyvatey

From 22 to 24 April 2024, CGCC team led by Ms. Pin Manika, Manager of Marketing and Business Development of CGCC, visited provincial branches of selected Participating Financial Institutions (PFIs) to discuss with the management and staff of the selected PFIs regarding the implementation of CGCC’s credit guarantee schemes and to increase more awareness of the credit guarantee. The selected PFIs in 3 provinces include:

– Takeo province:  Philip, Maybank, and Prince Bank.

– Kep province: ACLEDA Bank, ABA Bank, and Sathapana Bank

– Kampot Province: Sathapana Bank  and Canadia Bank

The discussions with CGCC PFIs’ provincial branches in these 3 potential provinces provided opportunities for both CGCC and PFIs to enhance mutual understanding of credit guarantees and opportunities for PFIs to increase lending to potential borrowers that lack collateral when requesting loans.

Extension of Request for Proposal “Legal Counsel”

Posted on by Sorn Chhorvyvatey

CGCC is a state-owned enterprise, established under the technical and financial guidance of the Ministry of Economy and Finance (MEF) to provide credit guarantees based on international standards to improve financial inclusion and support the growth of SMEs in Cambodia. CGCC obtained the accreditation from the Securities and Exchange Regulator of Cambodia (“SERC”) to become the bond guarantor on 22 August 2023 (“Bond Guarantor” or “Guarantor”).

CGCC wishes to provide guarantee on bonds to be listed on the Cambodia Securities Exchange.

CGCC is seeking to engage a Cambodian legal counsel (“Legal Counsel”) to perform the services as described in the scope of work.

 

High-ticket Loans of $50,000 Issued as Credit Guarantee Scheme Kicks off

Posted on by Sorn Chhorvyvatey

To boost startups and SME entrepreneurs, more high-ticket (above $50,000) loans without property collateral are now being issued by microfinance institutions (MFIs).

The main reason behind this is the take-off of the Credit Guarantee Corporation of Cambodia (CGCC) for SMEs. Normally, MFIs would only give small-ticket loans between $1,000-$3,000 without property collateral.

In the last decade, the higher the loan amount more would be the property collateral asked for. So looking at data from the fourth quarter of 2024 from the Cambodia Microfinance Association (CMA), for tier-1 loans less than $3,000 — 85 percent of these loans were issued without property backing it as collateral. Then for tier-2 loans between $3,001-$10,000 – 22 percent of loans were issued without collateral. And for tier-3 loans between $10,001-$50,000 – only 19 percent of such loans were issued without property collateral.

So far the data is following the expected trend as in past years. But if one were to look at tier-4 loans – which are above $50,000 – as high as 40 percent of loans were issued without property collateral.

And this is primarily because the CGCC in a bid to promote new ideas and new businesses has stepped forward to guarantee loans amounting to $164 million to 1,928 micro, small and medium enterprises (MSMEs) in the last three years. CGCC CEO KL Wong told Khmer Times that guaranteeing such loans has resulted in SMEs creating jobs. “The loans we’ve guaranteed have resulted in more than 52,000 new jobs in Cambodia from the SMEs we support,” he said.

Heng Bombakara, First Deputy Director General of Banking Supervision, National Bank of Cambodia (NBC), also said that the creation of CGCC is an acknowledgement of the vital role SMEs play in the economy. “SMEs represent 70 percent of employment opportunities in the country and contribute 58 percent to our country’s GDP. And these SMEs operate in diverse fields like agriculture, industry and services; and CGCC has been created to give a boost to this sector,” he said at a recent event.

Mindful of the diversity of SMEs in the country, CGCC guaranteed as much as 50 percent of loans for SMEs in services and trade, 3 percent from agriculture, 7 percent from industry and the remaining 40 percent to other miscellaneous SMEs.

CMA said that many of its members, including LOLC Microfinance and AMK Microfinance are participating financial institutions in the CGCC’s scheme. CGCC saw its highest loan guarantee activity in March 2022 – when it guaranteed as much as 91 businesses for $8.3 million in loan.

CGCC CEO Wong said that this pace of lending was maintained in 2023 where the state-owned enterprise guaranteed $72 million in loan amount for 943 accounts.

Credit to: Khmer Times, Published on 24 April 2024

CGCC Provides $181 Million Credit Guarantees to 2,143 Businesses as of March

Posted on by Sorn Chhorvyvatey

The Credit Guarantee Corporation of Cambodia (CGCC) has provided credit guarantees of US$181 million as of March this year to 2,143 businesses as their working capital for expansion.

In a factsheet issued on April 11, CGCC said as of March, the outstanding guaranteed loan was US$121.32 million while the outstanding guaranteed amount was $87.63 million.

There are 1,988 micro, small and medium enterprises (MSMEs) and 155 large businesses in Cambodia, the report said, adding that 881 of businesses were women-owned.

The CGCC scheme involves 27 participating financial institutions (PFIs) to extend credit as working capital investment and business expansion to SMEs.

Established in November 2020 with a state budget of $200 million, the CGCC is the preferred credit guarantee institution in Cambodia set up to improve financial inclusion and develop the growth of SMEs.

Smooth loan distribution has boosted entrepreneurship and financial inclusion, said Mey Vann, Secretary of State at the Ministry of Economy and Finance.

“The CGCC has played a key role in serving the needs of SMEs in Cambodia, which are struggling in the wake of the Covid-19 pandemic and the inflation crisis, and need credits from banks for their businesses,” he said.

Credit to: Khmer Times, Published on 13 April 2024

CGCC 1st Town Hall Meeting 2024 on “Milestones in Q1 2024 and Strategy Plan in Q2 2024”

Posted on by Sorn Chhorvyvatey

On 11 April 2024, CGCC organized the Quarterly Town Hall meeting, a gathering of all management and CGCC staff to update on the progress and milestones of CGCC in the 1st quarter of 2024 as well as share the strategy and action plans of all respective departments of the 2nd quarter of 2024.

This Town Hall Meeting was attended by all management and staff and was not only to share the progress report and plans from all departments but also for a dialogue platform to openly discuss and obtain recommendations from management on the direction of CGCC’s operations and vision in improving financial inclusion and developing SMEs in Cambodia. 

 

CGCC participating in UNDP Cambodia Investor Convening

Posted on by Sorn Chhorvyvatey

On 08 April 2024, Mr. Wong Keet Loong, CEO of CGCC was invited to be a panelist at the “Investor Convening Event for the Growth Stage Impact Venture Program in Cambodia” to share CGCC’s initiative in enabling the financing environment for private sector development Cambodia in the panel discussion focusing on “Investment landscape in Cambodia Specifically in Climate Adaptation”.

Through this panel discussion, Mr. Wong shared the government’s support mechanism for the private sector in access to finance through CGCC credit guarantee for businesses, especially green sector businesses. He also highlighted the Sustainable Green Financing Facility of CGCC, which is a blended financing model developed with support from UNDP to increase CGCC’s guarantee capacity for the green sector.

This UNDP Cambodia Investor Convening event aims to raise public and private sector interest and awareness around climate-anchored market solutions and investments, and also serve as a platform to mobilize and channel private sector capital and blended financing towards climate change adaptation and to diversify sources of climate financing by capitalizing on existing market opportunities.

CGCC and Royal Group Securities Plc. (RGS) Signed a MoU to Strengthen Cooperation on Bond Guarantees to Support the Bond Market Development in Cambodia

Posted on by Sorn Chhorvyvatey

On 5th April 2024, Credit Guarantee Corporation of Cambodia (CGCC) and Royal Group Securities Plc. (RGS) signed a Memorandum of Understanding to strengthen cooperation on bond guarantees to support the bond market development in Cambodia witnessed by H.E. Sou Socheat, Delegate of the Royal Government of Cambodia in charge as Director General of Securities and Exchange Regulator of Cambodia (SERC), and highly attended by H.E. Hong Sokhour, Delegate of the Royal Government of Cambodia in charge as Chief Executive Officer of Cambodia Securities Exchange (CSX).

CGCC officially became the First Cambodian Bond Guarantor on 31 January 2024 after getting approval from H.E. Deputy Prime Minister, Minister of Economy and Finance on the Policy Framework on Bond Guarantee, accredited by the SERC as the first local bond guarantor, and rated khAAA, the highest rating on a local scale, by the Rating Agency of Cambodia.

Mr. Wong Keet Loong, Chief Executive Officer of CGCC, said, “CGCC has been accredited by the SERC to be the bond guarantor for corporate bonds listed on the CSX.  This partnership with RGS will enable us to be part of the structuring of bonds between the Issuers and Investors.  The guarantee for corporate bonds enhances the credit rating of the bond issuance, which adds confidence to investors.  CGCC, as a state-owned enterprise under the Ministry of Economy and Finance (MEF), will support SERC’s aspirations to develop the capital market to enable large businesses to source for funding by issuing bonds. With the bond guarantee, we hope to attract both local and foreign institutional investors to invest in the guaranteed bonds.”

Mr. Seng Chan Thoeun, Chief Executive Officer of RGS, said, “I am pleased to announce our strategic partnership with CGCC, aimed at enhancing debt capital raising through bond guarantee in Cambodian capital market by the state-owned corporate bond guarantor. This collaboration represents a significant milestone in our commitment to foster growth and trust within the financial sector. By leveraging our expertise and resources as a well-established securities firm, RGS will collaborate and support CGCC in providing guarantee to our local businesses, enhanced assurance to investors, thereby increasing confidence in bond offerings. Our joint effort will also enable us to offer more favorable terms and conditions to issuers, facilitating access to capital and promoting greater participation in the market. Ultimately, we believe this partnership will play a pivotal role in stimulating economic growth and development by providing a robust environment for capital formation and investment.”

The partnership between CGCC and RGS will play a significant role in supporting Cambodia’s sustainable economic development by collaborating in knowledge and resource sharing between the two institutions to develop bond guarantees that will support bond issuers in raising funds in capital markets, attract investors to invest in corporate bonds, and increase the bond market’s liquidity.

About CGCC

CGCC is the only credit guarantee corporation in Cambodia, established by the decision of Samdech Akka Moha Sena Padei Techo Hun Sen, as a state-owned enterprise under the technical and financial guidance of the Ministry of Economy and Finance. The primary mission of CGCC is to provide credit guarantees to improve financial inclusion and support the growth of SMEs in Cambodia.

About RGS

Royal Group Securities Plc. (RGS) is a full-licensed securities firm under the supervision of Securities and Exchange Regulator of Cambodia. RGS offers a wide range of professional financial services including capital raising, M&A, capital restructuring, stock trading, international stock investment, equity valuation, co-investment and financing, and more. RGS is the sole financial advisor and underwriter of all bonds issued in 2023 and subsequently listed on Cambodia Securities Exchange. In the second half of 2023, the company raised over USD 100 million for local businesses through IPO, bonds, and loan.

 

 

CGCC Attended the Regional Workshop on Strengthening Regional Partnerships for Climate Transition.

Posted on by Sorn Chhorvyvatey

On the 26th & 27th March 2024 in Bangkok, Thailand, CGCC Delegation, led by Mr. Wong Keet Loong, CEO of CGCC attended the Regional Workshop on Strengthening Regional Partnerships for Climate Transition.

Mr. Wong Keet Loong was also invited to share on CGCC’s Sustainable Green Financing Facility, a blended financing model developed together with support from UNDP to increase our guarantee capacity for the Green sector.