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Thailand : B280 billion in loans for troubled SMEs

May 24, 2014

The Ministry of Finance is working with Thai Credit Guarantee Corporation (TCG) and commercial banks to make available 280 billion baht for fresh loans to 52,000 cash-strapped small and medium enterprises (SMEs) in Thailand.

Rungsan Sriworasat said SMEs need more access to loans and loan guarantees because their sales plunged due to the economic slowdown and the political conflict.

The Ministry of Finance was working with TGC and commercial banks to arrange extra credit.

The corporation had 165 billion baht available to guarantee loans and should be enough to support 52,000 SMEs and help generate additional loans of about 280 billion baht.

TGC would extend its deadline for payment of loan guarantee fees by 6 months, from June 1 to Dec 31, 2014, to help its clients' liquidity problems. This should increase liquidity by 2.8 billion baht.

The Ministry of Finance, the Thai Bankers' Association and the TGC plan to increase the proportion of credit guarantees from 18% to 50% of loans by inviting the participation of foreign credit guarantee firms.

The arrival of foreign credit guarantee firms would encourage commercial banks to lend more to SMEs and the additional loans from this initiative should amount to 150 billion baht.

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Source: TendersInfo (India)