KBank offers assistance to start-ups to ensure loyalty
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Kasikornbank will gradually build up its entrepreneur market by offering management know-how and providing an opportunity for start-ups to promote their business on television.
The bank targeted the market three or four years ago, but the portfolio has not increased much because of little credit and high risk, executive vice president Patchara Samalapa said yesterday.
The start-up portfolio is Bt720 million, of which non-performing loans (NPLs) are 4 per cent.
The bank will allow start-ups to get credit if they have been operating for at least two years.
Despite the high risk, KBank needs to focus on this market because if it helps them, they will become loyal customers. However, it has to have a process in place to screen them to ensure NPLs stay low.
How much the start-up business will grow is uncertain, but knowledge in doing business is a basic matter for those customers.
KBank, as the biggest lender to small and medium-sized enterprises, should play an important role in producing programmes and activities to shed light on these businesses.
“SME Tee Tak”, a TV show for SME businesses; “The Expert – Dream Inspiring Phenomenon”, an edutainment reality show; and the latest project, “SME Mee Tang Yer”, for training start-ups with marketing gurus, are part of KBank’s ideas to help start-ups besides lending.
The bank hopes its loans to start-ups this year will increase to Bt1.5 billion.
Start-ups are in the small-business segment with credit lines under Bt20 million. The growth of small businesses depends on domestic consumption. Since the country is in an upcycle for domestic consumption, this segment is stronger than before.
However, some small-business customers especially those upcountry want to accelerate their growth to cash in on the upcycle. This might lead to “risk” in running their business, Patchara said.
The bank is also refocusing its small-business development on agricultural customers after finding ways to help prevent defaults.
Small businesses have helped KBank expand its SME portfolio, which rose by 4 per cent to Bt456 billion in the first four months of this year. New loan bookings were Bt76 billion or up 7 per cent from the end of last year, Patchara said.
