Co-Financing Guarantee Scheme to support Tourism Recovery

To support the government’s policy on tourism recovery and growth of the sector, Credit Guarantee Corporation of Cambodia (CGCC) launched the Co-Financing Guarantee Scheme for Tourism (CFGS-TR) after approval by the Ministry of Economy and Finance.

CFGS-TR is specifically designed to provide credit guarantees on co-financing loans disbursed by CGCC’s Participating Financial Institutions (PFIs) under the Tourism Recovery Co-Financing Scheme (TRCS) of the SME Bank of Cambodia.

It is a joint effort by the two state-owned enterprises to improve access to finance for SMEs in the tourism sector. While TRCS aims to lower SMEs’ cost of borrowing, CFGS-TR is a guarantee scheme that will act as collateral/security for 80 percent of the loan amount; thus, reducing the physical collateral required from the borrowers.

CFGS-TR will support new loan disbursements in the banking sector to SMEs. Meanwhile, PFIs will be able to offer higher loans and the risk exposure will be shared with CGCC up to 80 percent.

According to a press release the Co-Financing Guarantee scheme – Tourism is a sub-credit guarantee scheme under the Co-Financing Guarantee scheme offered by the CGCC to participating financial institutions on the loans lent out under the Tourism Recovery Co-Financing schemes of SME Bank of Cambodia.

Hong Vannak, an economic researcher at the Royal Academy of Cambodia, said that the provision and receipt of a loan with legal guarantees have played an important role in the growth of the economy, particularly, in a crisis caused by Covid-19.

When the financial sector is stable, there is a lot of investment and job creation. On the other hand, when small and medium enterprises have sufficient capital, it also helps to increase production processes and reduce imports and increase exports, he added.

He further said that providing credit guarantees has helped both lenders and borrowers to have confidence in each other because before daring to guarantee, the CGCC always has conditions and studies the business first.

(Article from Khmer Times: Publication on July 14, 2022)

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Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

On Friday 24 June 2022, Mr. Wong Keet Loong, CEO of CGCC, together with CGCC’s colleagues participated in the dissemination workshop on “Access to Loans with Credit Guarantees for Businesses in the Tourism Sector”. This dissemination workshop was organized by the Ministry of Tourism and presided over by H.E. Song Tong Hab, Secretary of State of the Ministry of Tourism, with the participation of the management of the Ministry of Tourism, associations, federations, and the business owners in the Tourism Sector.

Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

Mr. No Lida, Deputy CEO of CGCC, presented to the management of the Ministry of Tourism as well as businesses in the Tourism Sector about CGCC’s credit guarantee schemes and mechanism aiming to support tourism businesses’ access to loans with credit guarantees, especially loans without enough collaterals, to order to support the Tourism Sector’s recovery and development.

CGCC has launched 3 credit guarantee schemes to support Micro, Small, and Medium Enterprises (SMEs), large firms, and women-owned businesses for easier access to loans despite collateral challenges through partnerships with banks and Microfinance Institutions (MFIs) to improve financial inclusions and develop SMEs.

Dissemination Workshop on Access to Credit Guarantee for Businesses in Tourism Sector

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