Logo of Phnom Penh Post newspaper Phnom Penh Post - SME Bank and ARDB disburse $63M in loans

SME Bank and ARDB disburse $63M in loans

Content image - Phnom Penh Post
Small and Medium Enterprise Bank of Cambodia (SME Bank) CEO Dexter Tan Beng Kong. Hong Menea

SME Bank and ARDB disburse $63M in loans

State-owned financial institutions Small and Medium Enterprise Bank of Cambodia (SME Bank) and Agricultural and Rural Development Bank of Cambodia (ARDB) have disbursed $63.44 million in loans to small and medium-sized enterprises (SMEs) as of Tuesday.

SME Bank CEO Dexter Tan Beng Kong told a press conference held at the Council of Ministers on Thursday that microfinance institutions (MFIs) participating in the SME Co-Financing Scheme 2020 (SCFS) had received 175 loan applications for $21.44 million.

SME Bank has approved 168 of the applications for $19.75 million, he said.

He noted that the approved loans came from a diverse range of businesses spanning sectors such as food production and processing, consumer goods, tourism goods and waste management, industrial components, information technology (IT) research and development, and IT services sector.

“We believe that the $100 million allotted to this project will be used up by the end of this year,” Tan said.

The $100 million fund behind the project is jointly financed by the SME Bank and 32 other participating financial institutions.

These are 23 commercial banks, two specialised banks, five microfinance deposit-taking institutions (MDIs) and two MFIs.

SMEs can borrow up to $200,000 for working capital and $300,000 for investment capital with a maximum interest rate of seven per cent per annum and a repayment period of seven years.

ARDB director-general Kao Thach told the press conference that ARDB had received 430 loan applications for $42 million as of Tuesday. It has approved more than $11.37 million in loans.

He said: “Most of the loan applications come from pig, fish, chicken, duck and cattle farmers, as well as vegetable and fruit growers, as well as processors of agricultural products. We hope that the fund will be used up by the end of this year.”

The government in May decided to cut the annual interest rates from six to five per cent for working capital and from 6.5 to 5.5 per cent for capital investment, without service charges.

It also adjusted the maximum loan term from five to seven years for capital investment while retaining a short-term maximum of two years for working capital.

Ministry of Economy and Finance undersecretary of state Ros Seilava told a news conference that the economic crisis instigated by Covid-19 had been the primary trigger for the emergency SME lending endeavours.

He said the government has allocated $500 million in loans for SMEs in “a second phase”. Of that, $300 million will be provided for financing support and $200 million will be for credit guarantee projects.

“I hope that this magnitude of funding will help sustain our economy during the health crisis and be ready for recovery when it is over,” Seilava said.

MOST VIEWED

  • Hun Sen: Full country reopening to be decided in two weeks

    Prime Minister Hun Sen has announced that if the Covid-19 situation remains stable for 15 consecutive days from the end of the October 5-7 Pchum Ben public holiday, Cambodia will reopen fully, albeit in the context of Covid-19 whereby people have to adjust their lives to

  • Cambodia unveils new quarantine regulations

    The government has modified Covid-19 quarantine requirements, shortening the duration for, among others, Cambodian officials, foreign diplomats and delegations, investors and inbound travellers in general. According to an official notice signed by Minister of Health Mam Bun Heng late on October 16, quarantine length for Cambodian

  • Cambodia sets new Covid-19 quarantine rules

    The government has modified Covid-19 quarantine requirements, shortening the duration for, among others, Cambodian officials, foreign diplomats and delegations, investors and inbound travellers in general. According to an official notice signed by Minister of Health Mam Bun Heng late on October 16, quarantine length for Cambodian

  • Hun Sen: Cambodia set to fully reopen

    Prime Minister Hun Sen concludes that the October 5-7 Pchum Ben public holiday, during which many people either flocked to their hometowns for family reunion or gathered at tourist attractions across the country, has not caused an outbreak of Covid-19. In a special address to

  • Will Evergrande change the way Chinese developers do business in Cambodia?

    China’s property sector policy has exposed the grim financial condition of real estate developers including those operating in Cambodia, which raises questions over the viability of their projects and business going forward The dark blue netting draping over one of Yuetai Group Co Ltd’

  • Cambodia voted ‘world’s friendliest country’ in Rough Guides reader poll

    Cambodia ranked number one among the “World’s Friendliest Countries”, according to a reader poll conducted by London-based international website “Rough Guides”. Taking submissions through Twitter and Facebook, “Rough Guides”, a well-known travel agency and publisher of guidebooks, said the Kingdom “was by far the