Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank

On 13 July 2023 at Prince Tower, CGCC and Prince Bank signed a $3 million Portfolio Guarantee Agreement for women entrepreneurs. The Agreement is signed by Mr. Wong Keet Loong, Chief Executive Officer of CGCC, and Mr. Honn Sorachna, Managing Director and CEO of Prince Bank, with a participation of Lork Chum Teav Oknha Keo Mom, President of Cambodia Women Entrepreneurs Association (CWEA).

The Portfolio Guarantee Scheme (PGS) for Women Entrepreneurs of CGCC and Prince Bank is effective from 01 August 2023 which will enables Prince Bank to disbursed guaranteed loans to women entrepreneurs without having to get CGCC’s guarantee approval on each loan prior to loan disbursement. This PGS for Women Entrepreneurs will support quicker, easier, and more CGCC’s guaranteed loan disbursements through Prince Bank to women entrepreneurs who lack of collateral.

Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank
Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank

Mr. Wong Keet Loong, CEO of CGCC said “This USD3mil portfolio guarantee scheme (PGS) with Prince Bank was structured specifically to support women entrepreneurs in providing guaranteed loans.  We hope that with the bank’s strong network, we can increase our guarantees to women-owned businesses.  As at todate, CGCC has guaranteed 40% of its total guarantees of USD130mil to women-owned MSMEs ie. USD50mil.”

He added that The woman scheme comes with lower interest rates and guarantee fees for the 1st year.  These favorable terms will enable women MSMEs to obtain lower cost of financing.”

Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank
Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank

Mr. Honn Sorachna, Managing Director and CEO of Prince Bank Plc. stated “We are honored and excited to join the force with CGCC to boost the local economy by supporting the MSMEs segments, especially women MSMEs. Women are the cornerstone of a strong family foundation and in their community. Their involvement and contribution to commerce and the economy at large are very significant and very much lauded. women entrepreneurs with unique abilities and determination are admirable and should be emulated. They deserve the support and encouragement to grow from strength to strength. Under the Portfolio Guarantee Scheme (PGS), we aim to provide better liquidity with special conditions to women-owned micro, small, and medium enterprises to give them extra support for their working capital to invest and sustain their businesses. It’s always our top priority to support Cambodian individuals and businesses for their financial needs; we are trying harder to enhance our products and services and make them conveniently accessible to our Cambodians.”

Prince Bank has become CGCC’s Participating Financial Institutions (PFI) since 2021 and has actively utilized CGCC’s credit guarantees to address the MSMEs’ challenge of lacking collaterals by providing guaranteed loans. CGCC and Prince Bank hope that this PGS for Women Entrepreneurs will support Cambodian women entrepreneurs that are mainly MSMEs, the backbone of the economy.

Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank
Signing of a $3 million Portfolio Guarantee Agreement for Women Entrepreneurs Between CGCC and Prince Bank

About CGCC

CGCC is the first-ever credit guarantee corporation in Cambodia, established by the decision of Samdech Akka Moha Sena Padei Techo Hun Sen, Prime Minister as a state-owned enterprise under the technical and financial guidance of the Ministry of Economy and Finance. CGCC’s main mission is to provide credit guarantees to lenders on loans made to businesses based on international standards to share the risk with lenders and to improve financial inclusion.

About Prince Bank Plc.

Prince Bank Plc. started its business operations in 2015 as a private microfinance institution under the former name “Prince Finance Plc.” and was transformed into a commercial bank with license No. B 46 was granted by the National Bank of Cambodia on 18 July 2018. With a strong capital base, robust technological capabilities, solid expertise, and extensive knowledge of the local market, the bank aspires to become the industry leader by offering differentiated financial solutions through a mix of channels with great convenience to our customers. We are keen on contributing to the development of small and medium enterprises that constitute a key segment of our target customers. Currently, Prince Bank Plc. has 34 branches and 82 ATM locations nationwide.

CGCC provides $105M credit guarantees to over 1K businesses

The Credit Guarantee Corporation of Cambodia (CGCC) provided credit guarantees of $105 million as of February to businesses as their working capital for expansion.

In a factsheet issued on March 10, CGCC said that as of the end of February it has supported 1,155 businesses by providing credit guarantees for their loan applications, amounting to $104.9 million.

Large portions of the loan guarantee were used as working capital and other purposes of investment or business expansion, and capital expenditure, the report mentioned. As of January 2023, the outstanding guaranteed loan was $81.6 million while the outstanding guaranteed amount was $58.8 million.

Various credit guarantee schemes have played a crucial role in strengthening entrepreneurship and enhancing financial inclusion in Cambodia, especially during the Covid-19 pandemic, through the smooth disbursal of loans, CGCC said.

The CGCC has come up with three guarantee schemes so far — the Business Recovery Guarantee Scheme (BRGS) launched in March 2022, the Co-Financing Guarantee Scheme (CFGS) unveiled in September 2021 and the Women Entrepreneurs Guarantee Scheme launched in April 2022, besides the extension of the CFGS to tourism. The CGCC of the Ministry of Economy and Finance has extended the BRGS from January 1, 2023, until the $200-million scheme is fully utilised.

Updating some scheme features, including the scheme period, the definition of the micro, small and medium enterprises (MSMEs) and large firms, and the maximum loan amount for each guarantee are on the extension of BRGS.

BRGS aims to support businesses, including MSMEs and firms, to enhance their access to formal loans from Participating Financial Institutions for working capital, investment, and business expansion.

Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development

The 11th Give a Day has featured the Credit Guarantee Corporation of Cambodia as its keynote as well as enabled Cambodia’s entrepreneurial ecosystem to connect at the new Khmer Enterprise Headquarters for the first time in 2023.

Khmer Enterprise CEO Dr. Chhieng Vanmunin delivered the welcoming remarks highlighting the ongoing progression of the initiative which was first piloted in 2021 before receiving its full funding for monthly and quarterly meetings in 2022 and has now been renewed for 2023.

“The Give a Day monthly meetings and quarterly ecosystem builder events have been greatly welcomed by Cambodia’s entrepreneurial community – and have provided both learnings and networking opportunities between various sectors,” he told over 50 attendees from the ecosystem at KE headquarters.

Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Sabine Joukes Pact Cambodia Country Director and WE Act Chief of Party, Khmer Enterprise CEO Dr. Chhieng Vanmunin, Rajiv Pradhan Country Director at Swisscontact in Cambodia.

“We also wanted to welcome everyone to our new headquarters at the Business Development Center in Chroy Changvar, Phnom Penh, and advise that our open working space is available to everyone in the ecosystem as well as both our meetings’ rooms and event space,” he added.

Rajiv Pradhan Country Director at Swisscontact in Cambodia and Sabine Joukes Pact Cambodia Country Director and WE Act Chief of Party echoed this statement adding it was fantastic to reconnect the ecosystem for the first time in 2023.

Increase credit guarantee issuance by 50% in 2023

Delivering the keynote CGCC CEO, Wong Keet Loong commented the scheme was looking to increase the number of transactions it underwrites by 50% in 2023 as the organization looks to increase its outreach to the country’s micro and small and medium businesses, (MSMEs).

CGCC received its sub-decree on September 2020 and was fully incorporated in November 2020 its guarantees are intended to expand the availability of credit to smaller enterprises that may not have the collateral which banks typically require to advance working capital loans.

Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Conversations after the keynote presentation.

Initially launched as a tool to close the credit gap that emerged between small businesses during the pandemic, the CGCC issued its first guarantee in April 2021 and has since given a total of 985 Letters of Guarantee (LG) for loans worth $92.7. Mr Loong said that the CGCC had even more ambitious targets for 2023.

“My biggest goal for this year is to increase the outreach of our guarantees. The CGCC wants to provide guarantees to 1500 SMEs this year. We want to guarantee $100 million of loans in 2023. I know that is optimistic but I believe it can be done,” he said in response to a question from Cambodia Investment Review.

Rising interest rates may impact growth

Mr Loong said that the main barrier to reaching this target was the global macro picture, particularly the impact of rising US interest rates.

“The main issue right now is that external factors are affecting the cost of funding, which is going up as US interest rates rise and this is affecting a number of financial institutions (FIs). They see that fixed deposit rates are going crazy which is good for depositors, but not FIs and this impacts their lending,” he added.

Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Attendees at the 11th Give a Day.

Global factors may act as a drag on the CGCC’s work in the near term, but fellow speaker H.E. Dr. Chhieng Vanmunin, CEO of Khmer Enterprise, said that if credit guarantees become more widely used in Cambodia it would make it much easier for firms to do business internationally.

“In their current state, a lot of Cambodian companies are unable to demonstrate a track record of success, however, if they run through the credit guarantee program with CGCC it provides a history of how well they managed issues such as shipping and cash flow.

So this is one of the things that we support them to expand their market internationally,” he said.

40% of its guarantees go to female-owned businesses

The CGCC currently offers four different guarantee products and in April last year, it launched it’s third the Women Entrepreneurs Guarantee Scheme (WEGS), a $50m capped fund that is aimed at supporting women and female-owned businesses.

According to the CGCC’s data up to 40% of its guarantees go to female-owned businesses, whereas Mr Loong said that up to 65% of Cambodian MSMEs were run by women. An audience member, who didn’t identify herself, suggested that this gap was partly due to issues over lack of financial knowledge.

“One reason is that we know most women entrepreneur’s businesses are not registered and one way to improve that is via financial literacy, and this will have many benefits. If financial literacy is growing then entrepreneurs are more confident, more informed, and able to negotiate good loans,” she said.

Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Questions and answer session.

Mr Loong responded that the CGCC did support unregistered businesses, for the first year at least and that expanding awareness of credit guarantees should in turn increase the number of registrations by female business owners.

“However, we tell customers that you need to be registered after a year, because when the anniversary comes, if you’re not registered, then we charge you an additional 0.5%. So, in a way, it incentivizes businesses to be registered. But when they come on board, they can be unregistered,” he said.

The Give a Day program returns in 2023

Give a Day is an initiative within the Entrepreneurship Ecosystem Building Project (EEB) which is jointly funded by Khmer Enterprise, USAID’s WE Act Project through Pact Cambodia and Swisscontact.

In addition, to monthly meetings, the initiative also included a quarterly Ecosystem Builders Network (EBN) event that focused on mapping the six pillars of Isenberg’s Model of the Entrepreneurial Ecosystem.

Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development
The 11th Give a Day program at Khmer Enterprise Head Office on February 10, 2023.

The quarterly meetings created a space through which ecosystem builders and government agencies can share information, foster best practices, identify market gaps and opportunities, and explore collaboration or complementarity to strengthen the ecosystem.

Cambodia’s ESO ecosystem, broadly defined as groups that support, train, and fund entrepreneurs is still in the nascent stage with many new organizations launched to help nature and develop the sector.

Credit to Cambodia Investment Review: Give a Day: Credit Guarantee Schemes & Its role in Enterprise Development

Unsecured Loan Under CGCC Scheme from Canadia Bank

Canadia Bank has partnered with Young Entrepreneurs Association of Cambodia and Cambodia Women Entrepreneurs Association to provide special loan offers to members of both associations.

Canadia Bank provide special loan offers to:

1. Young Entrepreneurs Association of Cambodia

Unsecured Loan Under CGCC Scheme from Canadia Bank
Unsecured Loan Under CGCC Scheme from Canadia Bank


2. Cambodia Women Entrepreneurs Association

Unsecured Loan Under CGCC Scheme from Canadia Bank
Unsecured Loan Under CGCC Scheme from Canadia Bank

  • Interest Rate as low as 13.20% p.a
  • Loan Size: Up to $100,000
  • Loan Term: Up to 5 Years without collateral

Terms & Conditions
  • Be a member of Young Entrepreneur Association of Cambodia (YEAC) or Cambodia Women Association (CWA).
  • Business must be validly registered prior to loan approval (at least by district level/delegation authorities). For expired registered, shall renewed within 3 months upon loan drawdown.
  • Business length shall be greater than 2 years as of application date.
  • Borrower must be owner of business and represent name on business registration.
  • Loan request for the purpose of working capital or Investment/Business Expansion.

*** Note: The original content on this page is produced and owned by Canadia Bank

More info, please visit Canadia Bank’s website: Unsecured Loan Under CGCC Scheme from Canadia Bank

Understanding Credit Guarantee-Canadia Bank’s View on Partnership with CGCC

Read and Download in PDF: Hear from our PFIs_Canadia Bank

  1. As one of the first banks who become CGCC’s PFIs, what motivates Canadia Bank to utilize the credit guarantee schemes with the existing loan products of Canadia?

One of the main reasons that motivates us to use credit guarantee schemes is that we believe that the CGCC credit guarantee scheme can help potential business owners who need loans to for their businesses but do not have enough collaterals to access more capitals to meet the financial needs of their businesses, especially to recover and expand the businesses after the COVID crisis has been eased.


  1. After adopting CGCC’s credit guarantee schemes for more than a year, how do those schemes benefit the bank and your customers?

We have provided loans under the CGCC credit guarantee schemes to more than 200 clients with a total loan size of nearly $ 20 million over the past year. Through these guaranteed loans, clients are able to expand their business in various sectors that generate more employment and contributed significantly to the country’s economic recovery.


  1. How does Canadia Bank structure loans with credit guarantee?

We have CGCC’s guaranteed loan programs for potential clients with good credit histories and clear business plans. It can be provided to both existing customers and new customers.


  1. Recently, both Canadia Bank and CGCC have each launched products supporting women entrepreneurs. How will the “Smart Lady Loan” and CGCC’s “Women Entrepreneurs Guarantee Scheme” (WEGS) impact women-owned SMEs in greater access to finance regarding unsecured loans?

“Smart Lady” of Canadia Bank and “Women Entrepreneur Guarantee Scheme (WEGS)” of CGCC are making a significant contribution to support women entrepreneurs to access to the finance for their business needs, avoiding high-risk and risky loans. Through these two projects, women entrepreneurs have not only been able to access their loans more easily and conveniently but have significantly reduced their financial costs, especially in the first year, which included lower interest rates and guarantee fees. In addition, women entrepreneurs will receive many other benefits through the Smart Women Lady loan program from Canadia Bank.


  1. Canadia Bank is currently the top performer of using CGCC’s scheme, what is Canadia Bank’s strategy of further expanding the usage of credit guarantees, especially to the rural area SMEs?

We continue to reach out to our target customers, especially those who have potential businesses but do not have sufficient collateral to secure a loan. We will also continue to link credit guarantee schemes with our new loan products to provide a wider range of options for our customers.


  1. As the credit guarantee topic is a new topic in Cambodia, how should Canadia Bank and CGCC do to raise awareness of credit guarantee to the borrowers?

In order to raise awareness about credit guarantee, we should continue to promote it more comprehensively, especially reach out to more business owners through social media, workshops, business associations, etc.

Give Non-Collateral a chance! Credit Guarantee Mechanisms and Benefits for Banks, MFIs and Businesses

Download the Full article in PDF: Give Non-Collateral a chance! 

Lack of collateral is the main challenge for businesses in Cambodia to get loans. The Royal Government of Cambodia established the Credit Guarantee Corporation of Cambodia (CGCC) to address this challenge. With credit guarantees, borrowing without collateral is no longer impossible. For CGCC to yield the benefits requires a good understanding from relevant stakeholders about how it works.

Simply put, CGCC provides credit guarantees to share the credit risk with the banks on loans made to businesses. In other words, the banks can claim from CGCC if the guaranteed loan defaults. There are two main types of credit guarantee – individual guarantee whereby the guarantee covers individual loans and portfolio guarantee whereby the guarantee covers a portfolio consisting of multiple loans. Since CGCC itself is not a lending institution, it currently collaborates with banks and micro-finance institutions (MFIs) that are the participating financial institutions (PFIs) to provide guaranteed loans to businesses. As a government-backed institution with adequate capital in its account, CGCC is set to provide a wide range of guarantees on loans disbursed to Cambodian-owned businesses across the country.


Why should the lender need the credit guarantee?

Give Non-Collateral a chance! Credit Guarantee Mechanisms and Benefits for Banks, MFIs and Businesses
Give Non-Collateral a chance! Credit Guarantee Mechanisms and Benefits for Banks, MFIs and Businesses

When lending, banks normally protect themselves by requiring collateral from the borrowers. When the borrower cannot repay the loan, the banks liquidate the collaterals to cover the loss. If the required collateral is not sufficient, the bank is unlikely to lend. The collateral requirement becomes more stringent, especially during times of uncertainty such as the COVID-19 Pandemic, because businesses are perceived to be riskier, and banks become more risk-averse. Now with CGCC, the banks can protect themselves with the credit guarantee instead of the collaterals. Currently, CGCC provides credit guarantees up to 80% of the outstanding loan principal which means that the bank bears the remaining 20% of the loss if the loan defaults. The credit guarantee empowers banks to remain competitive in the market and to lend out more to underserved borrowers who lack collaterals, what is referred to as “credit additionality.”


Why should the borrower need the credit guarantee?

Give Non-Collateral a chance! Credit Guarantee Mechanisms and Benefits for Banks, MFIs and Businesses
Give Non-Collateral a chance! Credit Guarantee Mechanisms and Benefits for Banks, MFIs and Businesses

Credit guarantees increase the borrowing capacity. CGCC provides guarantees that act as collateral on the borrower’s behalf. Needless to say, CGCC cannot be beneficial for every business. By all means, if the business has sufficient collateral and the ability to repay the loan, the chance is that such a business does not need a credit guarantee, and the bank would also be happy to lend even without CGCC’s guarantee. However, it is common that a potential business with the ability to repay the loan is unable to borrow because of insufficient collateral. Businesses simply cannot pledge the collateral on every loan they wish to borrow. The collateral is limited. This is a huge loss to the business and the economy as a whole. With the required loan, the business could have generated more income, employed more workers, and produced goods or services that contribute to the economic growth of the country. When CGCC provides guarantees to the banks, the borrowers now have easier access to loans from the banks because the banks are willing to lend more with less collateral requirement.

Credit guarantees are used by many countries as a policy tool to improve access to finance and financial inclusion. However, never before has a credit guarantee corporation been incorporated in Cambodia. According to the World Bank, “Public credit guarantee schemes (CGSs) are a common form of government intervention to unlock finance for small and medium enterprises (SMEs). More than half of all countries in the world have a CGS for SMEs and the number is growing.” While many credit guarantee schemes have proved successful in supporting the SMEs, many have also failed.

It is still early to assess how far and how fast CGCC can support the businesses. CGCC must continue to strengthen credibility, efficiency, and transparency and adhere to the best practices including the World Bank’s principles for public credit guarantee schemes for SMEs to gain trust and support from all relevant stakeholders. What is also important at this stage is that all the players understand and start to utilize the credit guarantees for the right purposes.

CGCC visits PFIs provincial branches in kampong Speu, Preah Sihanouk, and Kampot, to Enhance Collaboration on the Credit Guarantee

From 29 August to 02 September 2022, CGCC team led by Mr. No Lida, Deputy CEO of CGCC, visited provincial branches of selected participating financial institutions (PFIs) to discuss with the management and staff of the selected PFIs the implementation of CGCC’s credit guarantee schemes. The selected PFIs in 3 provinces including Kampong Speu province: Canadia Bank and AMK Microfinance Institution; Preah Sihanouk province: ABA Bank, LOLC Microfinance Institution, Sathapana Bank, Canadia Bank, AMK, and Acleda; and Kampot Province: ABA Bank, Acleda Bank, AMK, and LOLC.

The discussions with CGCC PFIs’ provincial branches in these 3 potential provinces provided opportunities for both CGCC and PFIs to enhance mutual understanding of credit guarantees and opportunities for PFIs to increase lending to borrowers that lack collateral when requesting loans, especially where the provinces are the potentials in tourism sector, CGCC got the chance to bring awareness of the newly launched scheme, Co-Financing Guarantee Scheme for Tourism Sector, to enhance the support for businesses in tourism sector in getting guaranteed loans from CGCC’s PFIs.

Through these face-to-face discussions with more than hundreds of PFIs’ provincial managements and staffs, CGCC had such a great opportunity to learn directly about the implementation of credit guarantees by these selected PFIs provincial branches as well as their comments and feedback on CGCC’s credit guarantee schemes. CGCC and PFIs will continue to strengthen cooperation in providing guaranteed loans to business owners.

Government credit guarantee unit set for 2021

Phnom Penh Post: 26 November 2020

The Credit Guarantee Corporation of Cambodia (CGCC) is on track to be launched in the first half of next year, Banking Association of Cambodia (ABC) president In Channy told The Post on November 26.

The CGCC was established by Sub-Decree No 140 ANKr BK on September 1, coming under the Ministry of Economy and Finance and with $200 million in registered capital from the government.

The sub-decree said the corporation will provide loans “in a professional manner” to tackle challenges in the lending market and promote financial inclusion.

It read: “The CGCC will be tasked with providing credit services, evaluating and managing risks, cooperating with banks and financial institutions and development partners that also provide credit services, et cetera.”

The corporation sets out to increase access to financing for Covid-19-strained businesses in priority sectors and adapt to the Kingdom’s post-Covid-19 start-up landscape.

It officially registered with the Ministry of Commerce on November 13.

Channy said the CGCC will guarantee a source of capital for small- and medium-sized enterprises (SMEs) with limited collateral and provide them with collateral protection insurance.

He said the corporation would serve as a much-needed crutch for the private sector, and would particularly be able to respond to struggling SMEs’ credit needs.

“We have seen in the past that most of the SMEs that applied for loans at their banks and microfinance institutions [MFIs] did not have sufficient collateral, which made it impossible for them to fully obtain the loans that they need,” Channy said.

During a promotional programme for CGCC held at the finance ministry on November 23, senior government officials called on SMEs that have been unable to access loans during Covid-19 to apply at the corporation.

Speaking during the programme, ministry undersecretary of state Ros Seilava said the CGCC will help SMEs rehabilitate their businesses during Covid-19, and would focus chiefly on the agricultural, industrial and service sectors.

“I would like to appeal to all SMEs that have been facing difficulties in obtaining financing from commercial banks to re-apply for loans there,” he said.

He claimed that in 2021-2023, the amount that SMEs can borrow will be capped at $500,000. “Our gameplan is to help SMEs run their businesses smoothly during this health crisis,” Seilava said.

In a press release, the ministry said the CGCC will break through barriers to effective financing processes and provide new opportunities for banks and MFIs to expand their customer base.

“The CGCC will provide a substantial boon for the Cambodian economy – it will promote financial inclusion, support new growth sources and diversify the economy in line with industrial development policies, as well as offer an environment conducive to the creation of new loan products,” it said.

Through the corporation, the government will share risk with banking institutions, MFIs, as well as business owners in credit operations in order to breed credit and economic activity that would not manifest otherwise, the ministry said.

The CGCC will shield businesses from Covid-19 fallout and promote the long-term development of SMEs, it said.

According to Seilava, to rehabilitate the economy after the Covid-19 crisis, the government is seeking more funding from international financial partners, claiming that the World Bank plans to provide about $100 million in loan to the government for additional capital.

Read more: $200M credit guarantee scheme launched