Tag: Micro-Finance

សាជីវកម្មធានាឥណទានកម្ពុជា (CGCC) មានសេចក្តីសោមនស្សក្រៃលែង ក្នុងការប្រកាសដាក់ឱ្យដំណើរការនូវ “គម្រោងធានាឥណទានសម្រាប់សហហិរញ្ញប្បទាន (CFGS)” ជាផ្លូវការ។ គម្រោង CFGS ត្រូវបានបង្កើតឡើងជាពិសេស សម្រាប់កម្ចីសហហិរញ្ញប្បទានដែលផ្តល់ក្រោមគម្រោងសហហិរញ្ញប្បទានទ្រទ្រង់សហគ្រាសធុនតូច និងមធ្យម ជំហានទី២ (SCFS II) របស់ធនាគារសហគ្រាសធុនតូច និងមធ្យមកម្ពុជា ។

Credit Guarantee Corporation of Cambodia (CGCC) announce the launch of the Co-Financing Guarantee Scheme (CFGS). CFGS is specifically designed for the co-financing loans disbursed under the SMEs Co-Financing Scheme Phase II (SCFS II) of the SME Bank of Cambodia.

CFGS and SCFS II are the joint efforts of the two state-owned enterprises to improve access to finance for SMEs. While SCFS II aims to lower SMEs’ cost of borrowing, CFGS is a guarantee scheme that will act as collateral/security for 70 percent – 80 percent of the loan amount; thus, reducing the physical collateral required from the borrowers.

CGCC will launch the first tranche of the CFGS amounting to $50 million to guarantee loans under the SCFS II. This scheme will support the growth of new loans in the banking sector to enable business owners to borrow from the Participating Financial Institutions (PFIs) of CGCC. PFIs will be able to offer higher loan amounts and the risk exposure will be shared with CGCC up to 80 percent.

The Co-Financing Guarantee Scheme is the second credit guarantee scheme offered by the CGCC. CGCC launched the $200 million Business Recovery Guarantee Scheme (BRGS) in March 2021 to support the economic recovery during the Covid-19 pandemic. As of September 21, CGCC has assisted 85 businesses including SMEs by providing credit guarantees for their loan applications from the PFIs amounting to $12 million.

Ministry of Economy and Finance secretary of state HE Ros Seilava, who is also the chairman of CGCC’s board of directors, said that “the launch of the CFGS by CGCC is timely to provide additional support to the SCFS II of the SME Bank of Cambodia for risk-sharing with the PFIs. The two facilities will complement each other to address two key issues faced by the SMEs in access to finance – the high cost of borrowing and collateral issues.”

Cambodian-owned SMEs (>50 percent ownership) may approach the PFIs of CGCC, contact CGCC at 023 722 123 or [email protected] or visit www.cgcc.com.kh for more information. CGCC’s PFIs includes ABA Bank, Acleda Bank, AMK MFI, Amret MFI, Asia Pacific Development Bank, BRED Bank, Cambodia Post Bank, CAMMA MFI, Canadia Bank, Chamroeun MFI, Foreign Trade Bank of Cambodia, J Trust Royal Bank, LOLC MFI, Phillip Bank, PPCBank, Prince Bank, RHB Bank, Sathapana Bank, and Wing Bank. CGCC looks forward to working closely with all stakeholders to support the growth of SMEs with the CFGS.

Credit to: Phnom Penh Post, 22 September 2021 

Khmer Times: June 30, 2021

The Credit Guarantee Corporation of Cambodia (CGCC) has signed a credit guarantee agreement with the second batch of participating financial institutions (PFIs) comprised of (in alphabetical order) Amret Micro-Finance Institution (MFI), BRED Bank, Camma MFI, Foreign Trade Bank of Cambodia, J Trust Royal Bank, LOLC MFI and Sathapana Bank. This increases the total number of CGCC PFIs to 15.

The signing enables the CGCC and PFIs to collaborate on disbursing guaranteed loans to businesses in Cambodia.

The increased number of CGCC PFIs will provide borrowers with a more diverse choice of financial institutions across the country to seek financing under the corporation’s guarantee scheme. CGCC supports PFIs in disbursing loans to borrowers who are deemed able to repay them but lack collateral, by providing 70 to 80 percent guarantees that take the place of traditional collateral.

Secretary of State of the Ministry of Economy and Finance and Chairman of CGCC’s board of directors Ros Seilava said: “The credit guarantee mechanism is a new financial service in Cambodia that is expected to help resolve the financing challenges and bring [a] new lending culture to banks and microfinance institutions. I would like to encourage the PFIs to seize the opportunity of partnering with CGCC to expand [their customer bases] and market segments through the provision of new loans with the guarantees from CGCC. At the same time, to reap the long-term benefits of this credit guarantee scheme, it is very critical for the PFIs to adhere to professionalism and strengthen the governance on credit assessment and monitoring.”

CGCC launched the $200 million Business Recovery Guarantee Scheme (BRGS) in March 2021 to support businesses including micro, small and medium enterprises, as well as large firms, to enhance their access to formal loans from the PFIs for working capital, investment and business expansion.

The scheme is available until the end of  2022 and the guaranteed loans will be disbursed through the PFIs on a “first-come, first-serve basis”. So far, 18 guarantees have been issued to PFIs under the BRGS.

Eligible borrowers may approach the PFIs for the CGCC’s guarantee scheme or contact it directly via its website www.cgcc.com.kh for more information.

The 15 CGCC’s PFIs include (in alphabetical order) ACLEDA Bank, AMK MFI, Amret MFI, Asia Pacific Development Bank, BRED Bank, Cambodia Post Bank, CAMMA MFI, Canadia Bank, Foreign Trade Bank of Cambodia, J Trust Royal Bank, LOLC MFI, Phillip Bank, Prince Bank, RHB Bank and Sathapana Bank.

You might also be interested in Press Release Signing of Credit Guarantee Agreement between CGCC and the 2nd Batch of Participating Financial Institutions (PFIs)

Phnom Penh Post: 11 June 2021

Khmer Times: April 19, 2021

Small businesses raising questions about the process of applying for a loan through the newly formed Credit Guarantee Corporation of Cambodia (CGCC)’s Business Recovery Guarantee Scheme (BRGS), has prompted CGCC’s chief executive officer Mr. Wong Keet Loong to provide an overview of how the scheme works.

He noted first that the BRGS scheme was launched late last month to help support SMEs which have difficulty taking out loans due to a lack of securable assets.

Under the BRGS scheme, the CGCC provides a guarantee of 70 to 80 percent of the value of the loan depending on the sector, assuring Participating Financial Institutions (PFIs) they will be secured in lending to the SMEs. The guarantee acts as part of the collateral or security for the loan. The scheme, however, will not let SMEs off the hook if they find themselves in default.

Wong said: “The SMEs are ultimately responsible to repay the loans.  [The] CGCC guarantee will assist in enabling the SMEs to borrow from the PFIs.  As such, in the event that the SMEs are unable to repay the loan due to failure of the business, the CGCC guarantee will be the last resort for PFI to claim for the losses.”

In the case of a default and the CGCC guarantee being paid out, the PFIs would continue to seek repayment from the SMEs with the CGCC being proportionally reimbursed from any recoveries made, Wong added.

The interest rates for the loans are determined by the PFIs.

Wong added that any business interested in the loan should have the capacity to repay it. It’s intended to help companies continue operating, as opposed to serving as an initial investment for a startup company.

Each PFI has to individually assess each loan applicant and ensure they are able to meet the institution’s requirements to borrow. While the BRGS scheme allows for loans to be extended to clients, it doesn’t guarantee approval for an applicant who otherwise would be denied.

Wong said the scheme helps businesses, the banks, and the country.

“Our motive when we started this scheme was to create more loans so that businesses can use the money for direct reasons and grow their business. This indirectly helps the country to grow,” he said.

He added that the CGCC – the first of its kind in Cambodia — will be here for the long haul and similar institutions exist in other regional countries, including his home country of Malaysia.

In light of the recent lockdown, he said all businesses are encouraged to apply once business operations resume as normal.

While the scheme has yet to take off due to the pandemic, the CGCC has received an application for a $1 million loan from a company in the industrial sector, the limit allowed in the program.

It appears the first list of PFIs participating in the scheme has yet to start advertising the product on their websites. The current list includes ACLEDA Bank, AMK MFI, APD Bank, Cambodia Post Bank, CANADIA Bank, Phillip Bank, and Prince Bank.

Mr. Huot Sokha, AMK’s chief business officer, said: “The BRGS is still in progress, therefore we cannot share its details yet. We have continuously supported businesses through many different activities as much as we can. In April last year, we rolled out a co-financing loan campaign to support SMEs that was advertised throughout our branch networks and on social media as well. Taking part in such programs is our commitment to support sustainable SMEs in Cambodia, especially during the pandemic, which is a very tough time for them.”

Read more: $200M credit guarantee scheme gets first member

AKP Phnom Penh, March 29, 2021 —

The Ministry of Economy and Finance and Credit Guarantee Corporation of Cambodia (CGCC) today launched the Business Recovery Guarantee Scheme (BRGS).

According to the ministry’s press release made public this morning, the BRGS aims to support businesses including micro, small and medium enterprises, and large firms to enhance their access to formal loans from Participating Financial Institutions (PFIs) for working capital, investment, and business expansion. This initiative is in line with the policies of the Royal Government of Cambodia to support the survival and economic recovery during the COVID-19 pandemic.

CGCC is the first-ever credit guarantee corporation in Cambodia, established by the decision of Samdech Akka Moha Sena Padei Techo Hun Sen, Prime Minister as a state-owned enterprise under the technical and financial guidance of the Ministry of Economy and Finance. CGCC’s main mission is to provide credit guarantees to PFIs to support and assist financially viable businesses that lack collateral when applying for loans.

The first tranche of the BRGS will contribute to a US$200 million increase of new loans in the banking sector for business owners to borrow from the following CGCC’s PFIs i.e., ACLEDA Bank, Asia Pacific Development Bank, AMK MFI, Cambodia Post Bank, Canadia Bank, Phillip Bank, and Prince Bank. The scheme will also be available at other banks and MFIs that are in the process of becoming CGCC’s PFIs. CGCC’s guarantee will act as collateral/security for 70-80 percent of the loan amount borrowed from the PFIs; thus, reducing the physical collateral required from the borrowers.

H.E. Ros Seilava, Secretary of State of the Ministry of Economic and Finance, and Chairman of CGCC’s Board of Directors state that the launch of the BRGS by CGCC is timely to support businesses who plan to borrow from the PFIs during this pandemic. This milestone supports the Government’s policy to maintain sustainable and inclusive economic growth and is in line with the Industrial Development Policy 2015-2025. He calls for banks and MFIs to support CGCC by being its PFIs and ensure good credit governance.

Cambodian-owned businesses (>50 percent ownership) may approach the above PFIs for the CGCC scheme or visit CGCC’s website www.cgcc.com.kh for more information.

“The Ministry of Economy and Finance and CGCC look forward to working closely with all stakeholders to support the growth of businesses with the BRGS,” underlined the press release.

Read more: CGCC executive clarifies Business Recovery Guarantee Scheme process

PHNOM PENH, March 29 (Xinhua) — State-owned Credit Guarantee Corporation of Cambodia (CGCC) on Monday launched a 200-million-U.S.-dollar Business Recovery Guarantee Scheme (BRGS), aiming to support businesses during the COVID-19 pandemic.

The BRGS was designed to support businesses including micro, small and medium enterprises, and large firms to enhance their access to formal loans from Participating Financial Institutions (PFIs) for working capital, investment, and business expansion, said a CGCC’s press statement.

CGCC is the first-ever credit guarantee corporation in Cambodia under the technical and financial guidance of the Ministry of Economy and Finance, the statement said, adding that its CGCC’s main mission is to provide credit guarantees to PFIs to support and assist financially viable businesses that lack collateral when applying for loans.

It said that the first tranche of the BRGS will contribute to 200 million U.S. dollars increase of new loans in the banking sector for business owners to borrow from the following CGCC’s PFIs including ACLEDA Bank, Asia Pacific Development Bank, AMK microfinance institution, Cambodia Post Bank, Canadia Bank, Phillip Bank and Prince Bank.

The scheme will also be available at other banks and microfinance institutions that are in the process of becoming CGCC’s PFIs.

CGCC’s guarantee will act as collateral or security for 70 percent to 80 percent of the loan amount borrowed from the PFIs; thus, reducing the physical collateral required from the borrowers, the statement said.

“The launch of the BRGS by CGCC is timely to support businesses who plan to borrow from the PFIs during this pandemic,” Economy and Finance Ministry secretary of state and CGCC’s chairman Ros Seilava said in the statement.

“This milestone supports the government’s policy to maintain sustainable and inclusive economic growth and in line with the Industrial Development Policy 2015-2025,” he added.

Read more: $200M credit guarantee scheme gets first member

Phnom Penh Post: March 29, 2021

The Ministry of Economy and Finance on March 29 launched a $200 million credit guarantee scheme to provide small and medium-sized enterprises (SME) with larger loans and easier application procedures to ensure their businesses remain afloat during the ongoing Covid-19 crisis.

The Business Recovery Guarantee Scheme (BRGS), under the ministry’s Credit Guarantee Corporation of Cambodia Plc (CGCC), will widen access to formal loans from participating financial institutions (PFI) for working capital, investment and business expansions, the ministry said in a press release.

Applicants must be majority Cambodian-owned to qualify for loans under BRGS, it said, noting that the initiative is consistent with government policy that addresses crisis survival and recovery support for the economy during the pandemic.

CGCC is the Kingdom’s first credit guarantee corporation, established by sub-decree No 140 ANKr BK on September 1 as a state-owned enterprise under the ministry’s technical and financial direction.

The ministry noted that CGCC’s primary mission is to provide credit guarantees to PFIs to support and assist financially-viable businesses that lack collateral to secure loans.

CGCC’s guarantee will act as collateral or security for 70-80 per cent of the loan amount borrowed from PFIs and hence reduce the physical collateral required from borrowers, it said.

Ministry secretary of state and CGCC chairman Ros Seilava said the instrument comes at a timely moment to support businesses that plan to borrow from the PFIs during the pandemic.

“This milestone supports the government’s policy to maintain sustainable and inclusive economic growth and [is] in line with the Industrial Development Policy 2015-2025,” he said, calling for financial institutions to join the roster of PFIs and “ensure good credit governance”.

In Channy, president and group managing directors of ACLEDA Bank Plc, one of the PFIs, lauded the move as a step forward to increasing the supply of loans to the SME sector.

“The credit guarantee is crucial, especially for those customers who have distinguished business plans, but don’t have enough collateral for the full amount of loans that they may need.

“This kind of scheme is long overdue since it will help customers, borrowers and entrepreneurs grow their businesses [by giving them] loan security.”

He explained that customers who wish to apply for loans under the scheme only need to follow the standard procedures at PFIs.

As of March 26, outstanding loan balance had risen six per cent from end-2020 to $4.559 billion and money in savings and deposit accounts had shot up nine per cent to $4.839 billion, he said.

Toch Chaochek, CEO of Cambodia Post Bank Plc, another PFI, said BRGS will prove a lifeline for SMEs with limited productive resources and budgets that had traditionally been unattractive to lenders and financiers.

“It is an admirable step by the government and will afford our SMEs an increased ability to secure larger loans through the scheme despite not having enough collateral, which is their key concern. And this stellar scheme comes bang on time given the current situation,” he said.

The ministry listed the PFIs as ACLEDA Bank, Cambodia Post Bank, Asia Pacific Development Bank, AMK MFI, Canadia Bank, Phillip Bank and Prince Bank, noting that other institutions are in the process of joining.