Financial Archives - Page 12 of 18

Credit guarantee helped firms to survive pandemic

Posted on August 19, 2022June 7, 2023 by Sorn Chhorvyvatey

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

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”

Posted on August 18, 2022June 7, 2023 by Sorn Chhorvyvatey

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”

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.”

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.”

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.”

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.

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

Posted on August 1, 2022June 8, 2023 by Sorn Chhorvyvatey

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.

You may also be interested in CGCC’s Co-Financing Guarantee Scheme to help Tourism Sector

PRESS RELEASE CGCC Launches Co-Financing Guarantee Scheme for Tourism to support the Recovery and Growth of Tourism Sector

Posted on July 12, 2022June 9, 2023 by Sorn Chhorvyvatey

To support the Government’s policy on recovery and growth of the Tourism Sector, the Credit Guarantee Corporation of Cambodia (CGCC) is pleased to launch the “Co-Financing Guarantee Scheme for Tourism (CFGS-TR)” after the highest approval from H.E. Akka Pundit Sapheacha Deputy Prime Minister, Minister of Economy and Finance.

CFGS-TR is specifically designed to provide credit guarantees on co-financing loans disbursed by CGCC’s Participating Financial Institutions (PFIs) under the Tourism Recovery Co-Financing Scheme (TRCS) of the SME Bank of Cambodia.

CFGS-TR of CGCC and TRCS of SME Bank are the joint efforts of the two state-owned enterprises to improve access to finance for SMEs in the Tourism Sector. While TRCS aims to lower SMEs’ cost of borrowing, CFGS-TR is a guarantee scheme that will act as collateral/security for 80% of the loan amount; thus, reducing the physical collateral required from the borrowers. CFGS-TR will support new loan disbursements in the banking sector to SMEs. Meanwhile, PFIs will be able to offer higher loan amounts, and the risk exposure will be shared with CGCC up to 80%.

For more information, please contact CGCC via 023 722 123, or visit CGCC’s official website www.cgcc.com.kh.

Phnom Penh, 12 July 2022

Credit Guarantee Corporation of Cambodia

CGCC visits PFIs provincial branches in Battambang, Banteay Meanchey, and Siem Reap, to Enhance Collaboration on the Credit Guarantee

Posted on July 11, 2022June 9, 2023 by Sorn Chhorvyvatey

From 04 July to 08 July 2022, CGCC team led by Mr. No Lida, Deputy CEO of CGCC visits PFIs (selected participating financial institutions) branches 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 Battambang province: AMK Microfinance Institution, ABA Bank, Acleda Bank; Banteay Meanchey province: ABA Bank, Canadia Bank; and Siem Reap Province: ABA Bank, Acleda Bank, AMK Microfinance Institution, Sathapana Bank, and Maybank (Cambodia).

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.

Through these face-to-face discussions with more than hundreds of PFIs’ provincial management and staff, CGCC had 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.

Click here to read about: Loans with Credit Guarantees to Support the Development of SMEs

Seminar on “Loans with Credit Guarantees to Support the Development of SMEs” in Battambang and Siem Reap Province

Posted on July 11, 2022June 9, 2023 by Sorn Chhorvyvatey

CGCC and Canadia Bank co-organized seminars on “Loans with Credit Guarantees to Support the Development of SME” on 05 July 2022 in Battambang Province and on 07 July 2022 in Siem Reap Province to introduce CGCC’s guarantee schemes and the benefits for both banks and MSMEs in improving access to finance as well as to introduce the bank’s guaranteed loan products to the business owners in these 2 targeted provinces.

Seminar on “Loans with Credit Guarantees to Support the Development of SMEs” in Battambang and Siem Reap Province — Seminar on “Loans with Credit Guarantees to Support the Development of SMEs” in Siem Reap Province on 07 July 2022

Participants in these seminars included business owners with the coordination of the Cambodia Women Entrepreneurs Associations (CWEA), Young Entrepreneurs Associations of Cambodia (YEAC), and Cambodia Association of Travel Agents (CATA), as well as CGCC team led by Mr. No Lida, DCEO of CGCC, and Canadia Team led by Mr. Song Kimhong, Head of SME Business Division of Canadia Bank.

CGCC hopes that these seminars are helpful for business owners that need loans for their business expansion and working capital but lack collateral when requesting loans to be aware and able to access loans guaranteed by CGCC through the PFIs of CGCC.

Click here to read about: Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

9th Board of Directors Meeting of Credit Guarantee Corporation of Cambodia (CGCC)

Posted on June 29, 2022June 9, 2023 by Sorn Chhorvyvatey

On 27 June 2022, CGCC organized the 9^th 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 9th Board of Directors Meeting included: (1) CGCC Progress Report, (2) Notification of PFIs Application Batch 5, (3) Request for Change of Annual Procurement Plan Implementation, (4) Request for Approval in Principle to Amend Articles of Incorporation of CGCC, (5) Delegation of Approving Authority for Credit Guarantee, and (6) Other matters.

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.

Click here to read about: Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

Posted on June 28, 2022June 9, 2023 by Sorn Chhorvyvatey

On Friday 24 June 2022, Mr. Wong Keet Loong, CEO of CGCC, together with CGCC’s colleagues participated in the dissemination workshop on “Access to Loans with Credit Guarantees for Businesses in the Tourism Sector”. This dissemination workshop was organized by the Ministry of Tourism and presided over by H.E. Song Tong Hab, Secretary of State of the Ministry of Tourism, with the participation of the management of the Ministry of Tourism, associations, federations, and the business owners in the Tourism Sector.

Mr. No Lida, Deputy CEO of CGCC, presented to the management of the Ministry of Tourism as well as businesses in the Tourism Sector about CGCC’s credit guarantee schemes and mechanism aiming to support tourism businesses’ access to loans with credit guarantees, especially loans without enough collaterals, to order to support the Tourism Sector’s recovery and development.

CGCC has launched 3 credit guarantee schemes to support Micro, Small, and Medium Enterprises (SMEs), large firms, and women-owned businesses for easier access to loans despite collateral challenges through partnerships with banks and Microfinance Institutions (MFIs) to improve financial inclusions and develop SMEs.

Click here to read about: CGCC shares tips to access to guaranteed loans for Women Entrepreneurs

CGCC shares tips to access to guaranteed loans for Women Entrepreneurs

Posted on June 16, 2022June 9, 2023 by Sorn Chhorvyvatey

On 16 June 2022, Mr. Wong Keet Loong, Chief Executive Officer of CGCC, participated as a panelist in the Women Entrepreneurs Forum on “Access to Finance and Markets for Women’s Business Growth”. Mr. Wong has shared the participation of CGCC in supporting financial inclusion for women entrepreneurs, especially in assisting them to get guaranteed loans.

In the panel discussion on “Increase access to information on financial products and services”, Mr. Wong emphasizes the importance of credit guarantees, acting as part of collaterals, to assist women entrepreneurs in obtaining loans from CGCC’s Participated Financial Institutions (PFIs). The credit guarantee mechanism is an additional intervention with favorable features, initiated by the government, to assist women-owned businesses to get formal loans for the purpose of working capital and business expansion, since 61% of the businesses in Cambodia are owned by women.

In addition to the ongoing support for women entrepreneurs from relevant stakeholders, Mr. wong also encourages all women entrepreneurs to be prepared to comply with the conditions of those favorable financing, including the credit guarantee. Credit guarantees that act as parts of collaterals for business loans through CGCC Participating Financial Institutions (PFIs) are eligible for all woman entrepreneurs. In order to obtain this supporting scheme, women entrepreneurs can seek information from CGCC and from CGCC’s 23 PFIs.

This Women Entrepreneurs Forum participates around 200 participants including women and women entrepreneurs, which provides the opportunity for them to access information and solutions addressing business issues, products/services development (e.g. access to finance, product requirements for local chains, how to access legal supports, and digital literacy). CGCC recently launched the third credit guarantee scheme, the Women Entrepreneurs Guarantee Scheme (WEGS), in April 2022, which is specifically designed for women and women-owned businesses, aiming to narrow the gap between the supply and demand for financing by providing a higher guaranteed coverage with favorable credit guarantee features. Women Entrepreneurs can find this scheme information at: https://cgcc.com.kh/en/women-entrepreneurs-guarantee-scheme/

Click here to read about: Courtesy visit by CGCC to NBC to discuss expanding more support to improve financial inclusion

448 Businesses Benefit under Credit Guarantee Scheme

Posted on June 9, 2022June 9, 2023 by Sorn Chhorvyvatey

The Credit Guarantee Corporation of Cambodia (CGCC) has supported 448 businesses by providing credit guarantees for their loan applications, amounting to $45.5 million as of May 31, according to the latest data.

The total loan amount included both national and foreign currencies with 19.8 billion riels and 40.56 million dollars. The loan sizes were in the range of $6,000 to $1 million. Letters of guarantee for 343 working capital loans, 103 investment expansions, and two capital expenditures were provided, according to a CGCC release.

The CGCC was established by the government in September 2020 as a state-owned enterprise under the technical and financial guidance of the Ministry of Economy and Finance.

The scheme is designed to help businesses that have good potential to receive bank loans even if they don’t have any collateral. It provided a merit-based opportunity for Small and Medium Enterprises (SMEs) and Micro and Small Medium Enterprises (MSMEs).

CGCC’s CEO Wong Keet Loong told Khmer Times that a credit guarantee is a financial instrument that supports both financial institutions and small enterprises.

For SMEs and MSMEs, it improves financial inclusion. It enables them to borrow without having the burden of providing collateral whenever their business capacity grows and they have higher loan requirements.

“Small business owners can obtain loans at affordable rates under the scheme. By having access to borrowing, business owners are able to scale up their businesses. We hope to reduce poverty to a certain extent through this,” Loong said.

CGCC launched the $200 million Business Recovery Guarantee Scheme (BRGS) in March 2021 to support businesses including MSMEs as well as large firms by enhancing their access to formal loans from the Participating Financial Institutions (PFIs) for working capital investment and business expansion.

The scheme is available until the end of this year and the guaranteed loans will be disbursed through the PFIs on a first-come-first-served basis.

Article credit to: Khmer Times, 06 June 2022

Click here to read about: CGCC recommends ways to Access to Guaranteed Loans

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