CGCC

CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral

(Phnom Penh, 22 September 2022): Credit Guarantee Corporation of Cambodia (CGCC) and DGB Bank has entered into a partnership on a credit guarantee agreement to expand support for businesses in all levels, ranging from micro to large firms in Cambodia that lack collateral in accessing to formal loans for their businesses with CGCC’s guarantees.

CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral
CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral

As a state-owned enterprise, operated under the technical and financial guidance of the Ministry of Economy and Finance (MEF), CGCC has launched credit guarantee schemes to enhance easier access to finance despite collateral challenges and provide the most support to SMEs, aligning with government strategy in SMEs development. Under this partnership agreement, DGB Bank becomes one of the 24 CGCC’s Participated Financial Institutions (PFIs) in providing guaranteed loans to businesses, especially SMEs that lack collateral for their working capital and business expansion.

Chief Executive Officer of CGCC, Mr. Wong Keet Loong mentioned that “The volume of guaranteed loans over the last 6 months has been increasing.  This indicates that the credit guarantee has supported SMEs in obtaining loans to grow their business.  Our participating FIs are able to share the risks of the loans with CGCC.”  

CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral
CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral

Mr. Wong added that “The collaboration with DGB Bank further reinforces our outreach to support more SMEs throughout the DGB branch network.  We are glad that DGB finds the benefits of the credit guarantee to support their loan growth and risk weight.” 

Chief Executive Officer of DGB Bank, Mr. Oul Dethsokhom said that “DGB bank is very excited of being able to sign the credit guarantee agreement with CGCC. With credit guarantee, the bank can take part in supporting businesses growth in the country and Cambodia’s economy in the ASEAN region”. 

CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral
CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral

 Mr. Oul Dethsokhom continued that “We were poised to enter into another government-led credit guarantee scheme dedicated to supporting SME business which could not procure funding source its own collaterals/guarantee.” 

 This joint force between CGCC and DGB Bank will enable businesses, especially SMEs, to have greater access to loans for their business growth by increasing borrowing capacity with the risk-sharing of credit guarantee schemes. It allows SMEs to borrow even without collateral and to get a higher loan amount with the same collateral value than they would otherwise get without a credit guarantee. 

CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral
CGCC and DGB Bank signed the partnership of credit guarantee agreement to provide more support for business loans that lack of collateral

 

 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 31 August 2022, CGCC has supported 661 businesses by providing credit guarantees for their loan applications, amounting to USD 64.8 million equivalent. CGCC has provided the most guarantee to SMEs, which accounts for 95% of the total businesses receiving the credit guarantee from CGCC. 

About DGB Bank 

DGB was “inaugurated as commercial bank” on September 01, 2021, with esteemed virtual participation from CEO of Daegu Bank and top management of the Bank. Throughout the year, the Bank unveiled four flagship products: deposits (CASA), remittance (domestic & Oversea), DGB Mobile app and ATMs services.  

The Bank has, in line with the NBC’s Prakas, lent hands to the clients by undertaking the plight of loan restructures, easing their grim burden during financial predicament. 

CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia

On 21 September 2022, Ms. Pin Manika, Manager of Marketing and Business Development of CGCC, participates as a guest speaker in the weekly meeting of the BNI Cambodia Chapter Brilliant and presents on CGCC’s credit guarantee schemes to more than 30 business owners. 

CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia

This sharing session is organized to promote credit guarantee schemes to potential business owners and to provide solutions for them on financial support response to the challenges of lack of collateral when applying for loans.  

CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia

Business owners who are BNI Cambodia members are very interested in CGCC’s credit guarantee scheme and enthusiastically ask further questions regarding to the process and conditions of applying for guaranteed loans. Members experienced in successfully requesting guaranteed loans also encourage other members to firstly contact banks or MFIs who are CGCC’s partners in case they need to apply for loans but do not have enough collateral.

CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia
CGCC sharing about credit guarantee schemes and benefits for members of BNI Cambodia

CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”

On 17 September 2022, CGCC and Maybank Cambodia co-organized the “SME Building Capacity and Capability (BCC) Programme” at Maybank Tower, participated by more than 50 SME entrepreneurs to provide business support instruments and technical advisory based on international best practices to support SME growth, productivity and innovation, as well as enhance competitiveness for SMEs.

Mr. No Lida, Deputy CEO of CGCC, remarks on the importance of this program for SMEs beyond the cooperation between CGCC and Maybank Cambodia, and Mr. Duk Sarak, Head of Community Financial Services of Maybank Cambodia, relayed the opening remark for the event. SME participants had the opportunity to learn about the topic of “Business Registration in Cambodia” from SokSiphana & Associates, “The Importance of Financial Discipline for SMEs” from Acclime Cambodia, “Access to Finance and Guarantee Scheme” from Maybank Cambodia.

CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”
CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”

Upon the collaboration on providing loans with credit guarantee, on November 2021, CGCC and Maybank Cambodia also co-organized the Business Forum on “Supporting SME Businesses in Cambodia” to discuss more details about the possibility of collaboration on how to support SMEs for greater access to finance despite collateral issue and the support of SME’s capacity Building and long-term growth.

CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”
CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”
CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”
CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”
CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”
CGCC and Maybank Co-organized the “SME Building Capacity and Capability (BCC) Programme”

11th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)

On 13 September 2022, CGCC organized the 11th Board of Directors Meeting, at CGCC’s office, 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.

11th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)
11th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)

The agendas of this 11th  Board of Directors Meeting included: (1) CGCC Progress Report, (2) PFI Application, (3) Strategic Business and Budget Plan for 2023, (4) Amendment to Finance Manual, (5) Credit Risk Policy, and (6) Other agenda

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.

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11th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)
11th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)

Click here to know more about: 12th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)

CGCC visits PFIs provincial branches in kampong Speu, Preah Sihanouk, and Kampot, to Enhance Collaboration on the Credit Guarantee

From 29 August to 02 September 2022, CGCC team led by Mr. No Lida, Deputy CEO of CGCC, visited provincial branches of selected participating financial institutions (PFIs) to discuss with the management and staff of the selected PFIs the implementation of CGCC’s credit guarantee schemes. The selected PFIs in 3 provinces including Kampong Speu province: Canadia Bank and AMK Microfinance Institution; Preah Sihanouk province: ABA Bank, LOLC Microfinance Institution, Sathapana Bank, Canadia Bank, AMK, and Acleda; and Kampot Province: ABA Bank, Acleda Bank, AMK, and LOLC.

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 borrowers that lack collateral when requesting loans, especially where the provinces are the potentials in tourism sector, CGCC got the chance to bring awareness of the newly launched scheme, Co-Financing Guarantee Scheme for Tourism Sector, to enhance the support for businesses in tourism sector in getting guaranteed loans from CGCC’s PFIs.

Through these face-to-face discussions with more than hundreds of PFIs’ provincial managements and staffs, CGCC had such a great opportunity to learn directly about the implementation of credit guarantees by these selected PFIs provincial branches as well as their comments and feedback on CGCC’s credit guarantee schemes. CGCC and PFIs will continue to strengthen cooperation in providing guaranteed loans to business owners.

MEF calling for loans to SMEs with no collateral

The Ministry of Economy and Finance (MEF) and Credit Guarantee Corporation of Cambodia Plc (CGCC) are encouraging banks and microfinance institutions (MFI) to use credit guarantee mechanisms to boost financial inclusion and help expand small- and medium-sized enterprises (SME) by issuing loans to businesses that lack collateral.

In an August 18 workshop on the potential of credit guarantee projects to enhance financial inclusion for SMEs in Cambodia, MEF secretary of state Ros Seilava, who is also CGCC chairman, touched on a business recovery guarantee scheme (BRGC) that was launched by the government via CGCC in March last year.

 

As of July 2022, the scheme, which has been running for more than a year, has supported the issuance of about $57 million new loans to businesses or companies that lack collateral through participating financial institutions.

Although $57 million might seem like a small amount, he said it was the beginning of a change in lending habits without relying on collateral in Cambodia’s credit market.

 

Not only in Cambodia, Seilava said credit guarantee mechanisms are an intervention policy tool used to support financing in economies in countries around the world.

“I hope that the National Bank of Cambodia [NBC] will set out a relevant regulatory framework and policy to drive and encourage banks and MFIs to use credit guarantee mechanisms to boost the financial inclusion and development of small- and medium-sized enterprises,” he said.

Seilava urged stakeholders to discuss challenges, especially banking and financial institutions and business owners, to find solutions to the comprehensive use of credit guarantee mechanisms.

In addition, a study on the terms and procedures of CGCC is necessary to consider adjustments and secure opportunities to cooperate between CGCC and development partners, as well as other stakeholders to develop credit guarantee projects to support specific priority sectors such as agriculture, industry and tourism, he stressed.

Meanwhile, NBC assistant governor Chea Serey said that in order to encourage banks or MFIs to use this credit guarantee mechanism to the maximum, SMEs themselves must strive to strengthen their businesses after obtaining a loan, especially through proper registration, so that they can get a credit guarantee from CGCC.

“What I see in Cambodia is that the challenges for SMEs in accessing financial services is that they are out of the system. Most SMEs in Cambodia are not yet properly registered, which makes it difficult for them to get a bank loan,” she said.

CGCC CEO Wong Keet Loong said that from the beginning of the third quarter of 2022, CGCC has expanded its credit guarantee to the whole country, even in remote provinces, thanks to the extensive branch network of participating financial institutions (PFI) nationwide.

“However, the CGCC still needs to do more to ensure that financial inclusion is further improved for the benefit of businesses across the country,” he said.

Song Kheng Lay, executive vice-president and chief operating officer of Canadia Bank Plc, believes that there is a need for credit guarantees to support banks to provide more loans to businesses or companies, especially those that lack collateral.

“Canadia Bank has developed a guaranteed lending strategy as well as procedures to apply for loans from SME banks to come to banks in order to obtain effective loans,” she said.

Data from the Department of SMEs of the Ministry of Industry, Science, Technology and Innovation showed that as of July 31, 2022, a total of 43,813 SMEs were properly registered out of “more than 520,000” SMEs.

Credit to: The Phnom Penh Post, August 18, 2022

Cambodia’s SMEs Battle String of Challenges

The head of the National Bank of Cambodia said Cambodia’s SMEs face a string of challenges, adding a scheme is available to offer financial support to those struggling to access credit.

The Director General of the National Bank of Cambodia, Chea Serey, said on Thursday that Cambodian SMEs face a number of challenges that range from a lack of human resources and market capitalization, to access to credit.

“There is a lot of SME competition, especially in Cambodia. If our SMEs are small, it will be difficult to compete in ASEAN,” Serey said at a conference to raise awareness of the importance of credit guarantees in assisting banks to make more loans to businesses, particularly those without collateral.

“So, if we do not fortify ourselves in Cambodia when the border opens, it will be easier to transport goods to and from each other, making our goods difficult to sell,” Serey said.

She added that in recognition of the importance of SMEs in the economy and their challenges in access to finance from banking and financial institutions, the government established Credit Guarantee Schemes to ensure SMEs receive credit.

“I think it is a good solution. Also, it is a short-term solution for SMEs that have not been recognized or registered,” she said. “This solution is critical and timely for SMEs in the context of Covid-19.”

The conference was hosted by the Ministry of Economy and Finance under the theme, “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”.

During the conference, Ros Seilava, Secretary of State at the Ministry of Economy and Finance, said the forum is important for raising awareness of the credit guarantees through discussion and experience sharing among relevant stakeholders. More than one year ago, the government launched the public credit guarantee scheme by establishing CGCC.

“As of July 2022, the CGCC had supported the disbursement of approximately $57 million in new loans, with credit guarantees to businesses lacking collateral via the Participating Financial Institutions (PFIs),” he said.

“Even though $57 million is a small sum, it marks the beginning of new lending practices in Cambodia’s credit market that do not rely on collateral,” Seilava said.

Meanwhile, Wong Keet Loong, Chief Executive Officer of CGCC, said that as of the beginning of Q3 2022, CGCC has expanded its guaranteed coverages to include all provinces, including remote provinces.

“However, more still needs to be done to improve financial inclusion for various groups of businesses in other parts of the country,” he said.

The conference included representatives from the government, development partners, financial institutions, business associations, and business owners, particularly SMEs.

Small and medium-sized enterprise (SME) development is a crucial priority in ASEAN countries’ strategies, including Cambodia. SMEs are critical to Cambodia’s economy, accounting for 70 percent of employment, 99.8 percent of businesses, and contributing 58 percent of the GDP.

SMEs are often regarded as the backbone of Cambodia’s economy and engine of economic development.

Credit to: kiripost, August 18, 2022

Click to know more about: Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

Credit guarantee helped firms to survive pandemic

Various credit guarantee schemes have played a crucial role in strengthening entrepreneurship and enhancing financial inclusion in Cambodia, especially during the Covid-19 crisis, through smooth disbursal of loans, said top officials who gathered yesterday for a conference on ‘Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia.’

Wong Keet Loong, CEO of the Credit Guarantee Corporation of Cambodia (CGCC) said it was incorporated on November 3, 2020, with two main policy frameworks. First to help viable businesses by providing access to formal financing and second to ensure sustainability for the CGCC’s operations.

The conference, jointly organized by the Ministry of Economy and Finance (MEF) and CGCC, aimed to raise awareness of credit guarantee benefits for SMEs.

Wong said that the CGCC has come up with three guarantee schemes so far — the Business Recovery Guarantee Scheme (BRGS), launched in March 2022, the Co-Financing Guarantee Scheme (CFGS), in September 2021 and the Women Entrepreneurs Guarantee Scheme (WEGS) in April 2022, besides the extension of the CFGS to tourism. “Each scheme was specifically designed to target different market segments,” he said.

Credit guarantee helped firms to survive pandemic
Credit guarantee helped firms to survive pandemic

He added that CGCC has succeeded to expand its guarantee scheme all over the country, even in the remotest provinces, thanks to the vast branch networks of the participating financial institutions (PFIs). “However, more still needs to be done to ensure that financial inclusion is improved for different groups of businesses across the country,” Loong said.

“We also see a positive trend among female borrowers, who get loans without collateral. There were only 43 women-owned SME who borrowed in 2021, but by the end of July 2022, there are 197 of them. This was due to the PFIs’ women-supported loan products and CGCC’s efforts in reaching out to more women-owned SMEs for uncollateralized loans,” he noted.

You may also be interested in Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

As of now, CGCC has 23 PFIs with more than 1,000 branches across the country, yet only 18 PFIs have applied for credit guarantees so far. “I firmly believe that this conference could raise awareness among all the stakeholders about the benefits and potential of credit guarantee. I am looking forward to seeing more credit guarantee requests by PFIs after this event,” Loong said.

Ros Seilava, Secretary of State of the Ministry of Economy and Finance and Chairman of CGCC, said that the CGCC has so far provided a credit guarantee for $57 million in loans disbursed by PFIs.

Based on data from the World Bank, 41 countries launched 57 credit guarantee schemes during the Covid-19 crisis in 2020 to boost lending from financial institutions to businesses through risk sharing.

Credit to Khmer Times: August 18, 2022

Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

Phnom Penh, 18 August 2022: Ministry of Economy and Finance (MEF) and Credit Guarantee Corporation of Cambodia (CGCC) co-organized a “Conference on Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia” presided over by H.E. Ros Seilava, Secretary of State, Ministry of Economy and Finance, and Chairman of CGCC, and H.E. Dr. Chea Serey, Assistant Governor and Director General of Central Banking, National Bank of Cambodia, with the participation of representatives from the Government, development partners, financial institutions, business associations, and business owners, especially SMEs, of more than 100 participants. The Conference aims to discuss using credit guarantees to strengthen SME’s financial inclusion, raise awareness of credit guarantees, and share experiences and lessons learned from guaranteed loan disbursements.

 

Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

H.E. Ros Seilava, Secretary of State, highly appreciated today’s Conference, which is an important forum to raise awareness of the credit guarantees through the discussion and experience sharing among related stakeholders. H.E. Secretary of State said, “The Government launched the public credit guarantee scheme by establishing CGCC more than one year ago. As of July 2022, CGCC has supported the disbursement of about $57 million new loans with credit guarantees to businesses that lack collateral through the Participating Financial Institutions (PFIs). Even though this $57 million is a small amount, it is the starting of new lending practices that do not rely on collateral in Cambodia’s credit market.”

Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

H.E. Dr. Chea Serey mentioned in her keynote address the contribution of the National Bank of Cambodia (NBC) as the regulator who plays a critical role in supervising the banking sector. H.E. Dr. Chea Serey said, “Understanding the importance of SMEs in the economy and their challenges in access to finance to the banking and financial institutions, the Government decided to establish the credit guarantees to support SMEs that lack collateral. CGCC’s credit guarantee is a good policy tool; however, SMEs should not remain laissez-faire. SMEs shall continue to improve their capacity, i.e., by leveraging technology.”

Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

Mr. Wong Keet Loong, Chief Executive Officer of CGCC, expressed his gratitude to the Royal Government of Cambodia, who, through the Ministry of Economy and Finance, has always provided strategic guidance to CGCC to expand the credit guarantees to support the Government’s financing policy. Mr. Wong said, “As of the start of Q3 2022, CGCC has expanded its guaranteed coverages to all over the country, even in the remote provinces, thanks to the vast branch networks of CGCC’s PFIs across the country. However, more still needs to be done to improve financial inclusion for different groups of businesses in other parts of the country.”

Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

During the conference, the representatives from CGCC’s PFIs, Canadia Bank and Sathapana Bank, shared common views on the importance of credit guarantees in supporting banks to disburse more loans to businesses, especially businesses that lack collateral. The banks’ representatives also shared their lending strategies with credit guarantees.

Two SME borrowers were invited to share their practical experiences in access to guaranteed loans with CGCC’s PFIs. Credit guarantees helped both business owners who did not have collateral to get loans for their business’s operations.

Moreover, representatives from relevant stakeholders, including the Government (a representative from the MEF), the regulator (a representative from NBC), the lender (a representative from Maybank Cambodia), the business owners (a representative from the Young Entrepreneurs Associations of Cambodia) and the credit guarantee institution (a representative from CGCC) joined the panel discussion on “Roles of Credit Guarantee in Banking and Business Sector Development.” The panelists discussed the challenges, solutions, and recommendations to improve the effectiveness of using credit guarantees to support business sector development, especially the SMEs, which are the backbone of the economy.

Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”
Press Release Conference on “Credit Guarantee Schemes’ Potential to Strengthen SME’s Financial Inclusion in Cambodia”

CGCC provides credit guarantees on business loans disbursed by banks and microfinance institutions to support potential businesses that lack collateral. CGCC serves the Government’s policy to improve financial inclusion and develop SMEs in Cambodia. For more information, please contact CGCC via 023 722 123 or 016 242 033 or visit CGCC at www.cgcc.com.kh. Thank you.

Phnom Penh, Thursday, 18 August 2022

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CGCC Guarantees $50.5 Million Credit

Credit to Khmer Times: Published on 27 July 2022

Credit Guarantee Corporation of Cambodia (CGCC) has issued 515 letters of guarantee for loans worth $50.5 million by the end of June this year since the launch of the credit guarantee scheme in March 2021, according to the CGCC quarterly newsletter.

The report showed that the loans were guaranteed under the business recovery guarantee scheme, co-financing guarantee scheme, and women entrepreneur guarantee scheme. The state-owned firm guaranteed $28.9 million in loans in the first half of this year — an increase of over 130 percent compared to 2021.

Wong Keet Loong, CEO of CGCC, said that the scheme for the second quarter of this year showed growth in both guaranteed value and the number of letters of guarantee issued compared to the first quarter — increasing to $18.4 million from $10.3 million and to 189 letters of guarantee from 128.

“We are confident that the momentum will continue into the second half of the year. We will continue to support participating financial institutions that can reach out to more entrepreneurs,” said Wong.

In May of 2022 alone, $7.4 million in loans were guaranteed for 71 businesses, according to the report, adding that this is the highest value of guarantees since April 2021. Of this, 412 letters of guarantee were for fixed-term loans.

According to the report, about 400 entrepreneurs used the loans as working capital and about 96 percent or 498 businesses availed an average of $100,000 each for the purpose.

About 75 percent, or 386 entrepreneurs, applied for the CGCC service without collaterals, the report pointed out, noting that the number of women entrepreneurs increased to 165 — availing 32 percent of the total loan — in June from 138 in May this year.

Entrepreneurs in Phnom Penh received 156 letters of guarantee, accounting for about 30 percent, followed by those in Battambang with 56, Kampong Cham with 34, and Kampong Thom and Siem Reap, with 30 each.

“The coverage of credit guarantee grew nationwide through the networks and branches of the participating financial institutions. However, some remote provinces still need more promotion to raise awareness of the scheme,” the report said.

In the April-June period this year, Canadia Bank, Sathapana Bank, and LOLC Microfinance Institution applied for most loan guarantees under the scheme which is operated with the technical and financial guidance of the Ministry of Economy and Finance.

Raymond Sia, CEO of Canadia Bank, said the commercial bank has provided nearly $20 million to over 200 customers under the scheme.

Canadia Bank has plans to provide more CGCC-guaranteed loans to both existing and new customers having good credit records and a clear plan of loan usage.

“We believe that the credit guarantee schemes can help potential business owners who are in need of loans but do not have sufficient collaterals, especially for the recovery and expansion of businesses after the pandemic,” he said.

Wong had discussed issues such as financial inclusion, financial literacy, and risk weightage for guaranteed loans with the Director General of National Bank of Cambodia, Chea Serey, last month during a meeting attended by officials from both institutions.

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