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Loan guarantee firm sets Bt500bn target under new fiveyear plan 

Mar 18. 2018
Wichet Warakul
Wichet Warakul
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By Somluck Srimalee
The Nation

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Thai Credit Guarantee Corporation (TCGC)’s fiveyear plan for 2018-22 is to lift its outstanding loan guarantees to Bt500 billion, covering 450,000 small and medium enterprises (SMEs) nationwide, senior executive vice president Wichet Warakul said recently.

As of the end of 2017, TCGC recorded total outstanding loan guarantees of Bt360 billion covering 300,000 SMEs.

This year, TCGC will focus on SMEs who plan to upgrade or increase their production capacity. This follows its government approved Bt81 billion worth of loan guarantees between August 2017 and June 30 this year.

From August 2017 until February this year, TCGC has provided guarantees for loans under its increased capacity programme worth Bt51 billion. TCGC is confident that it will provide guarantees for the remaining Bt30 billion between now and June 30 this year, Wichet said.

Under this programme, customers can obtain loan guarantees to save costs. TCGC will guarantee an average 1.75 per cent a year for the first four years or a combined seven per cent for four years. This helps customers reduce their business costs, Wichet said.

This is apart of its guarantee loan target of Bt100 billion by the end of this year, up 16 per cent of its loan guarantee of Bt86 billion last year. TCGC will also maintain its non-performing loans, which totalled no more than 13.4 per cent early this year – a reduction from 13.48 per cent at the end of 2017, he said.

Wichet added that in the first two months of this year, TCGC had success in guaranteeing loans of Bt16 billion, or about 16 per cent of its total guarantee loan target for this year.

“At present, most commercial banks restrict their provision of loans to the customers, especially SMEs,” he said. “As a result, TCGC has invited SMEs to visit one of the 11 TCGC branches nationwide to see an adviser before applying for a loan from the commercial banks. This will help them to get a bigger loan from the banks, because TCGC will guarantee the loan for them.” 

Most commercial banks have restrictions on providing loans for SMEs because non-performing loans from this sector are rising.

However, Wichet said, TCGC will help SMEs by suggesting how they can manage their businesses and draw up a business plan to get a bank loan. This will help them to get loan easier than if they apply for the loan by themselves, he said.

 

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