KBank serves Chinese SMEs
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Presence in China gives bank a boost
Thanks to Kasikornbank’s footprint in China, it can smooth the way for Chinese small and medium-sized enterprises to set up operations in Thailand by offering credit, risk management and business-matching services.
“We can help customers save costs in running a business in Thailand,” Pipit Aneaknithi, executive vice president in charge of the network in China, said yesterday.
A local presence gives KBank a close-up view of trade flows of Chinese companies and insight into which Thai products can potentially cash in on demand on the mainland, he said.
KBank has already organised business-matching activities for LCD (liquid crystal display) televisions and rubber between Chinese buyers and Thai exporters, generating sales of 100 million yuan (Bt469 million).
KBank is trusted by Chinese companies because it has 19 Chinese bank partners that are members of Factors Chain International, a global network of finance companies, he said.
KBank aims to expand its portfolio of Chinese SMEs doing business in Thailand to between Bt7 billion and Bt8 billion this year thanks to the growing trade between two countries, said Patchara Samalapa, another executive vice president.
The bank’s outstanding loans to Chinese SMEs rose to Bt6 billion from 600 customers in the first quarter from Bt4 billion at the end of last year.
Chinese companies with annual sales of less than Bt400 million and Chinese as their major shareholders are the target customers.
Chinese companies are coming to Thailand because they want resources to supply their homeland, especially cassava, of which Thailand is the world’s largest exporter.
“We see the opportunity to facilitate Chinese buyers in making contacts with Thai cassava producers through business matching. That will help boost sales of Thai cassava and help our customers to save costs,” Pipit said.
A matchmaker is needed because Chinese buyers don’t know who the cassava exporters are and Thai producers want to sell directly to buyers to reduce the risk of defaults.
Yesterday, KBank arranged business matching for three Chinese cassava importers by introducing 30 Thai suppliers to them. KBank expects transactions of Bt5 billion to Bt7 billion to be generated from the event.
Business matching does not result in much lending but the activities give the bank the chance to strengthen its relationship with customers.
China is aggressively pursuing a strategy to use cassava as a non-grain feedstock for ethanol production to reduce crude oil imports.
Shi Linhua, managing director of INT Resource (Thailand), which participated in the business matching, said the company had expanded into cassava in the past two years because the parent company in China had built a plant to supply ethanol fuel in that country. The business matching helped his company save costs.
