More funds needed for rehab of SMEs, banks believe

Several bank executives expect the government to increase the amount of loans for damage sustained by SMEs.
Sirichai Sombutsiri, senior executive vice president of Siam Commercial Bank, said he expected the government to increase the loan amount, while SCB aims to lend Bt12 billion to its SME customers who join the scheme.

About 2,200 of the bank’s SME clients are flood victims and SCB expects 70 per cent of those to join the credit-guarantee programme. To SME customers who do not join the scheme, SCB will offer a 5-per-cent interest rate for the first year of a loan, he said.
Udomsak Rojviboonchai, executive vice president of Krung Thai Bank (KTB), said the programme was expected to be extended in terms of period and credit line.
KTB expects to provide loans of Bt20 billion to its SME customers who apply under the credit guarantee scheme.

Poomchai Wacharapong, head of SME banking at Bank of Ayudhya, said the bank’s customers were expected to seek loans of about Bt2 billion under the programme.
Pakorn Partanapat, executive vice president of Kasikornbank, said it aimed to lend Bt10 billion to SMEs under the scheme, while United Overseas Bank (Thai) aims to lend Bt2 billion to its customers.
Yesterday, 13 commercial banks and two stated-owned banks – Government Savings Bank and the Islamic Bank of Thailand – signed a memorandum of understanding with the SBGC to guarantee combined loans of Bt100 billion for flood-hit SMEs.

SME operators who apply under the programme must be located in flood-affected zones. Also eligible are SMEs that have orders or sales not less than 25 per cent of total sales with partners that are in flood-affected provinces.
An enterprise can seek a loan for Bt10 million. Banks will charge 3-per-cent interest to SMEs who join the scheme in the first three years and minimum lending rate from the fourth to seventh years.
SMEs will be forgiven the credit guarantee fee of 1.75 per cent per annum for the first three years.