B240bn loan guarantee for SMEs

B240bn loan guarantee for SMEs

Thai Credit Guarantee Corporation (TCG) expects to sign agreements with 17 financial institutions to guarantee loans worth a combined 240 billion baht under the government's wage impact relief programme for small and medium-sized operators.

Chairman Surachai Danaitangtrakul said the government earlier approved a new tranche of soft loans worth 240 billion baht to help ease the impact of the daily minimum wage hike.

Apart from SMEs, TCG also provides credit guarantee for new graduates seeking to become entrepreneurs, another election pledge of the government.

The government earlier approved the new scheme to make it easier for fresh graduates to set up their own businesses. A start-up fund with an initial budget of 15 billion baht has been set up for this group.

Under the scheme, each operator will get a loan up to 3 million baht, 2 million baht of which will come from financial institutions and guaranteed by TCG. Another 1 million baht will come from the start-up fund.

TCG will waive the credit guarantee fee for the first year, but it will charge a 2.5% fee, higher than the typical 1.75%, in subsequent years.

TCG would be able to guarantee a total of 10 billion baht under the scheme.

At the end of last year, TCG had outstanding loan guarantees worth 82 billion baht. Total income stood at 3.28 billion baht while expenses were 2.97 billion. Net profit was 309 million baht and non-performing loan guarantee stood at 3.6%.

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