Some SMEs can now seek urgent loans with TCG guarantee
The state-owned Thai Credit Guarantee Corporation (TCG) will for the first time provide direct guarantees to small and medium-size enterprises in urgent need of loans.
The TCG has prepared direct guarantees of Bt1.5 billion for these SMEs, TCG president Rak Vorrakitpokatorn said, adding that the service will begin later this month.
The direct guarantee is similar to a letter of guarantee to needy SMEs, which can hand it to banks to seek loans with TCG backup.
Currently, SMEs have to seek loans at banks first. If they do not have enough credit, the banks will advise them to seek TCG help.
TCG has already partnered with three banks in the initiative, Rak added.
The SMEs qualified for the direct guarantee must be ones that have been in operation for at least five years and reporting substantial revenue. Their balance sheets must report a positive financial status for a consecutive three years.
The TCG will provide guarantees not exceeding Bt40 million per SME.
The fee for the guarantee is between 2.5 per cent and 3 per cent of the total guaranteed loan.
