On 7 June 2022, Credit Guarantee Corporation of Cambodia (CGCC), led by Mr. Wong Keet Loong, CEO of CGCC, pay a courtesy visit to H.E. Dr. Chea Serey, Assistant Governor and Director General of Central Banking of the National Bank of Cambodia (NBC), at the NBC.
Mr. Wong is very grateful for the warm welcome of H.E. Dr. Chea Serey and updated H.E. Dr. Chea Serey about CGCC’s latest progress to support SMEs and improve financial inclusion.
H.E. Dr. Chea Serey praised the progress made by CGCC and expressed her support for CGCC’s mission to provide guarantees on loans disbursed by banks and microfinance institutions (MFIs) to businesses, especially SMEs that lack collateral.
Today’s meeting is an excellent opportunity for CGCC to know more about NBC and discuss synergies between NBC, financial institutions, and CGCC in improving financial inclusion and financial literacy amongst micro, small, and medium enterprises in Cambodia.
On 24 May 2022, CGCC conducted a visit to Canadia Bank at Kampong Chhnang Branch for a meeting and sharing the CGCC’s credit guarantee schemes to the Management team and related bank staff at that branch.
After sharing CGCC’s credit guarantee schemes and the benefits for banks and customers who are business owners, this meeting also brought the opportunity for both CGCC and Canadia bank Kampong Chhnang branch to have a mutual understanding of the importance of credit guarantee, and the practice of the banks in raising awareness of the credit guarantee forbusiness owners who are bank’s customers.
Canadia bank is among the first official CGCC-participated financial institutions (PFI) and is also a supportive partner in providing loans under CGCC guarantee to SMEs and large firms for their working capital and business expansion.
CGCC and Canadia Bank, one of CGCC’s Participated Financial Institutions (PFIs), with the coordination from the Biogas Technology and Information Center (BTIC), conducted the field visit on 24 May 2022, to a farm raising fattening pigs that has a potential of getting loans guaranteed by CGCC in Samaki Mean Chey district, Kampong Chhnang Province.
This pig farm has been using lagoon digesters for biogas production under the “Reduction of Greenhouse gas emission through Promotion of Commercial Biogas Plants”, which has been implemented by BTIC and supported by the United Nations Industrial Development Organization (UNIDO).
In January 2022, CGCC entered into a Memorandum of Understanding (MoU) with the BTIC which was jointly established by the Royal University of Agriculture (RUA) and the United Nations Industrial Development Organization (UNIDO). Therefore, the farm visit indeed brought the opportunity for CGCC and partners to get more understanding of the importance of having more support to enable the access to financial resources for commercial biogas technology investment for fostering the adoption and implementation of commercial biogas technologies in the livestock sector and agro-processing industry which it will provide the great potential for the sectors in harnessing wastes to energy and in complying with bio-security system, sanitation and environment safeguards (such as preventing odor and water pollution).
On 03 May 2022, Mr. No Lida, Deputy Chief Executive Officer of Credit Guarantee Corporation of Cambodia (CGCC), participated as a speaker in the panel discussion on “SMEs and FinTech Joining Hands to Promote Economic Recovery”, organized during the MoU signing ceremony between Cambodia Asia Bank (CAB) and SME Bank of Cambodia on SMEs Co-Financing Scheme Phase II.
The panelists in the discussion included the Chief Operation Officer of CAB, Head of Credit of SME Bank of Cambodia, and Chief Executive Officer of Bankograph.
Mr. No Lida shared the importance of narrowing the financing gap between demand and supply for the economic development and CGCC’s mission of providing credit guarantees to banks/MFIs on loans made to businesses to share the risk with lenders and to improve financial inclusion. In addition, he also provided some recommendations to businesses in order to gain access to guaranteed loans.
In September 2021, CGCC launched the Co-financing Guarantee Scheme (CFGS), which is specifically designed for the loans disbursed under the SMEs Co-Financing Scheme Phase II of the SME Bank of Cambodia.CFGS helps the PFIs to disburse more unsecured loans to SMEs.
CGCC’s participation in this event is also a response to the newly launch CGCC’s Women Entrepreneurs Guarantee Scheme (WEGS), effective from 01 April 2022, and CGCC strongly believe that our sharing today will bring more awareness to target women entrepreneurs for greater access to finance with favorable credit guarantee features.
Phnom Penh, March 25, 2022 – A conference on the financial inclusion of women entrepreneurs in Cambodia, co-hosted by the UN Development Programme (UNDP) and the Credit Guarantee Corporation of Cambodia (CGCC), was held in Phnom Penh today to discuss existing challenges in financial inclusion and harness collective intelligence and knowledge on enhancing access to finance for women-led micro, small, and medium enterprises (MSMEs).
The event presented key findings from UNDP’s upcoming report on the ‘Cambodia Public Credit Guarantee Scheme for Small and Medium-Sized Enterprises and Women-Owned Small and Medium Enterprises, which found that the main challenges for MSMEs to access finance are, in order of severity, the problematic requirement for collaterals as loan securities, stringent lending requirements which do not consider MSMEs business operation, high-interest rates, short loan repayment periods, and weak MSMEs overall management capacity and keeping of quality financial and other supporting documentation. COVID-19 created additional difficulties for MSMEs, with 21.3% of surveyed enterprises reporting greater difficulty in accessing finance, especially among small and informal firms run by women in the manufacturing, construction and real estate, and hospitality sectors.
Penel Discussion on “COVID-19 Recovery and Opportunities for MSMEs in Accessing Finance”
The UNDP report estimates that a public credit guarantee scheme would have a significant positive impact on the country’s GDP and on job creation. Two main sectors were highlighted: agriculture and hospitality (i.e., hotels and restaurants). The report estimates that for every US$100 million invested in agriculture, an approximate $221 million would be generated as value added to the national inflation-adjusted or real GDP and 48,737 jobs would be created (17,348 for women). The return on investment from the hospitality sector was estimated at $201 million, with 16,226 potential jobs created (1,130 for women).
UNDP Cambodia’s Resident Representative Ms. Alissar Chaker emphasized “Women entrepreneurs are underserved by the financial system. Although they own 61% of businesses in the country, only 3% of the nation’s women entrepreneurs have access to formal credit (WB, 2019)[1]. Women-owned MSMEs are a great asset for post-pandemic recovery and future prosperity. A relevant public credit guarantee scheme would adjust credit market failures and access challenges by providing third-party credit risk mitigation to women lenders in case of loan default. It will also promote a more inclusive financial system and wider access which is not necessarily preconditioned by collaterals, often lacking or insufficient for women.
“UNDP and other development partners are supporting national efforts for accelerating socio-economic empowerment of women. Women entrepreneurs are encouraged to stay abreast of financial and non-financial services available in the market, including public guarantees, to make informed decisions and widen their options for financial accessibility,” said Ms. Chaker.
Mr. Wong Keet Loong, CEO of CGCC, Presented “The Credit Guarantee Scheme and How It Benefits the Development of SMEs”
“Launched in early 2021, CGCC is tasked with the mission to provide a credit guarantee, and thus, to promote inclusive access to finance. From our portfolio, small and medium enterprises cover most of our guaranteed loans (96%). However, only 25% of all businesses that received loan guarantees are owned by women,” said Mr. Wong Keet Loong, CEO of CGCC. “CGCC’s new scheme, launched during the conference today, which is specifically designed for women-led MSMEs owners aims to close the financing gap among women entrepreneurs and formal financial institutions.”
As part of the conference, women-headed MSMEs shared their perspectives, challenges, and experience relating to access to finance. Participants could also connect with other peer business owners and participating financial institutions for networking, information-sharing possible future collaboration.
UNDP supports the Royal Government of Cambodia’s response and recovery efforts from COVID-19 through promoting inclusive and sustainable growth, responsive and strong institutions, social protection, digitalization, e-commerce acceleration, and resilience to climate risks while leaving no one behind.
About UNDP:
UNDP is the leading United Nations organization fighting to end the injustice of poverty, inequality, and climate change. Working with our broad network of experts and partners in 170 countries, we help nations to build integrated, lasting solutions for people and the planet. Learn more at https://www.kh.undp.org/ or follow us @UNDPCambodia.
About CGCC:
The Credit Guarantee Corporation of Cambodia Plc. (CGCC) is a state-owned enterprise established by Sub-Decree No. 140 ANKR.BK dated 1 September 2020. CGCC is operated under the technical and financial guidance of the Ministry of Economy and Finance.
[1] World Bank (2019). Exploring the Opportunities for Women-owned SMEs in Cambodia.
On 16 March 2022, CGCC organized the 8th Board of Directors Meeting, under the chairmanship of H.E. Ros Seilava, Secretary of State of the Ministry of Economy and Finance, and the chairman of the CGCC’s Board of Directors, with the presence of all members of the Board of Directors.
The agendas of this 8th Board of Directors Meeting included: (1) CGCC Progress Report, (2) Women Entrepreneurs Guarantee Scheme, (3) 2021 Audited Financial Statements, (4) CGCC New Office Rental Contract, (5) Amendment to Guidelines on Employees Compensation, (6) Staff’s Bonus and Salary, (7) IT Policy, and (8) Other matters including Bond Guarantee.
CGCC’s Board of Directors Meeting is regularly organized to review, endorse, and approve CGCC’s activities and progress, especially the credit guarantee schemes, to ensure transparency and efficiency of CGCC.
On 15 March 2022, Mr. No Lida, Deputy Chief Executive Officer of Credit Guarantee Corporation of Cambodia, was invited as a speaker to a webinar on “Introductory to Commercial Biogas Technology” organized by Biogas Technology & Information Center (BTIC) Cambodia, under the topic “Financing for Commercial Biogas Adoption- Credit Guarantee’s Intervention”. The purpose of this webinar is to raise public awareness of biogas technology and access to finance for the biogas project.
Mr. No Lida has presented to a wide range of audiences about CGCC, CGCC’s credit guarantee schemes, credit guarantee procedures, and benefits of credit guarantee, as well as CGCC’s strategy and partnership with related stakeholders including PFIs, development partners, and business associations. CGCC is strongly committed to working together with other stakeholders to promote access to finance for clean energy businesses.
CGCC has signed a Memorandum of Understanding (MoU) with the Biogas Technology and Information Center (BTIC) which was jointly established by the Royal University of Agriculture (RUA) and the United Nations Industrial Development Organization (UNIDO) through the project “Reduction of Greenhouse gas emission through Promotion of Commercial Biogas Plants”, funded by the Global Environment Facility (GEF), a key project for UNIDO’s ongoing Programme for Country Partnership in Cambodia. This cooperative partnership aims to promote investments in commercial biogas technologies in Cambodia.
Cambodian Public Bank Plc. (Campu Bank) and Credit Guarantee Corporation of Cambodia (CGCC) entered into a partnership agreement on Credit Guarantee at Campu Bank Building on 24 February 2022.
The main objective of the partnership is to financially assist the Small and Medium-size Enterprises (SMEs) with easy access to funding for their business amid the COVID-19 challenges by providing working capital and capital expenditure financing which is also in line with the government’s initiative to assist SMEs to expand their business. Campu Bank will work closely with CGCC to promote guaranteed financing schemes that are offered by CGCC including the Business Recovery Guarantee Scheme (BRGS) to meet the needs and demands of the SMEs.
At the signing ceremony, Mr. Ong Ming Teck, Chief Executive Officer of Campu Bank said, “SMEs play a crucial role towards nation-building and economic growth of Cambodia by providing employment, income, and poverty reduction in the long term. The partnership would further strengthen our inspiration to promote financial inclusion and literacy to the SMEs and Cambodians especially those with limited access to low-cost financing and banking services.
Mr. Ong added that “the signing of the partnership is timely as Campu Bank is celebrating its 30th anniversary this year and more new products and services, and digital initiatives will be rolled out to benefit our customers as part of its celebration to mark our strong presence in Cambodia. We are confident of playing an instrumental role towards nation-building and providing financial access to the SMEs at all our 31 branches.”
Chief Executive Officer of CGCC, Mr. Wong Keet Loong mentioned that “CGCC is pleased to partner with Campu Bank which has a wide network of branches that can reach out to more customers to grow the development of SMEs.”
Mr. Wong added that “We are very encouraged to see the growth of the guaranteed loans in the first 2 months of the year which makes up about 45% of guarantees issued in 2021. With more economic activities, we are confident that the demand for credit guarantees will increase loans to business owners in Cambodia. We hope the participating FIs will reach out to more SMEs including the micro-segment to give them an opportunity to grow their business”
CGCC is a state-owned enterprise operated under the technical and financial guidance of the Ministry of Economy and Finance (MEF) and officially incorporated in November 2020. CGCC’s mission is to provide credit guarantees to lenders on loans made to businesses based on international standards to share the risk with lenders and to improve financial inclusion.
As of 21 February 2022, CGCC has supported 258 businesses by providing credit guarantees for their loan applications, amounting to USD 26.62 million. CGCC has provided the most guarantee to SMEs, which is accounted for 96% of the total businesses receiving the credit guarantee from CGCC.
On February 9th, 2022, Credit Guarantee Corporation of Cambodia (CGCC) and Cambodia Asia Bank (CAB) hosted a signing ceremony on Credit Guarantee Agreement at Sofitel Phokeethra Phnom Penh Hotel. The event was attended by Mr. Mitra Dwaipayan, Chief Operations Officer of CAB, Mr. Wong Keet Long, Chief Executive Officer of CGCC, and senior management from CAB and CGCC.
Mr. Mitra Dwaipayan mentioned in the ceremony that “CAB welcomes all the cooperation which is beneficial to all the stakeholders. From this partnership, MSMEs could request a loan from the bank to expand and operate their businesses even if they lack collateral, and the bank is more confident to give loans to the customers under this scheme. I think this scenario could not have happened without the great initiation from CGCC.”
Mr. Mitra has added that “About 30 years of CAB operation, we have contributed a lot to the banking and finance industry in Cambodia through our various products and services that benefit and serve our customers’ needs on time. We have also supported the prioritized sectors that have boosted economic growth. I believe that the cooperation between CAB and CGCC will help MSMEs as well as the banking and finance industry to be more developed.”
Mr. Wong Keet Loong, CEO of CGCC mentioned that “This partnership with CAB will be our 22nd participating financial institution (FI) in providing guaranteed loans to businesses. FIs are beginning to understand how the credit guarantee can benefit the FI in providing higher loan amounts to their borrowers despite being limited by collaterals.”
Mr. Wong added that “With more FIs participating in the credit guarantee scheme, CGCC hopes that more business owners all over the country will be able to access formal financing. This will enable higher economic activities that will drive the national economic growth.”
Please be noted that this agreement has been made especially for MSME owners which are in need of financial support to operate and expand their businesses, yet they lack collateral when requesting loans, so they still could request loans to CAB under this scheme.
About CAB
Cambodia Asia Bank (CAB) is the most trusted commercial bank that has been operating in Cambodia since 1993. CAB provided customers and business partners with various products and services such as loans, deposits, trade finances, international remittances, and global card payments such as Visa, Master Card, and UnionPay.
About CGCC
CGCC is a state-owned enterprise operated under the technical and financial guidance of the Ministry of Economy and Finance (MEF), and officially incorporated in November 2020. CGCC’s mission is to provide credit guarantees to lenders on loans made to businesses based on international standards to share the risk with lenders and to improve financial inclusion.
As of 02 February 2022, CGCC has supported 237 businesses by providing credit guarantees for their loan applications, amounting to more than USD 25 million. CGCC has provided the most guarantee to SMEs, which is accounted for 96% of the total businesses receiving the credit guarantee from CGCC.
