Logo of Phnom Penh Post newspaper Phnom Penh Post - SME Bank comes up short on loans

SME Bank comes up short on loans

Content image - Phnom Penh Post
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 year and a repayment period of seven years. Hin Pisei

SME Bank comes up short on loans

The Ministry of Economy and Finance wants to ease loan requirements for small and medium-sized enterprises (SMEs) from the State-owned Small and Medium Enterprise Bank of Cambodia (SME Bank) and offer more financial resources to boost production.

Spokesman Meas Soksensan told The Post that the ministry has reviewed the existing loan application process for local SMEs and found that many are not eligible.

“We want to see what the obstacles are [for the SMEs],” he said. “At the same time, we are trying to get them to properly register their businesses into the system and make it easier for us to manage them.

“We will try our best to help SMEs receive reserve funds because we want to make it easier for them to get loans,” he said.

SME Bank, with $100 million in government assets for loans, had a soft launch in April in conjunction with the ministry’s “SME Co-Financing Scheme 2020” (SCFS) – a joint venture between SME Bank and a number of financial institutions.

Federation of Associations for Small and Medium Enterprises of Cambodia (Fasmec) president Te Taingpor told The Post that despite the launch of SME Bank, however, requirements remain a major barrier for local SMEs to access loans.

“Most SMEs are already too far in debt to other financial institutions, leaving them without enough collateral to seek additional funds from SME Bank, which is why we don’t see many SME Bank loans,” he said.

SME Bank CEO Dexter Tan in June said the bank has allocated about 10 per cent of its total capital to SMEs and he hopes the full $100 million will be released by the end of the year.

There are currently 33 financial institutions involved in the SCFS – SME Bank, 23 commercial banks, two specialised banks, five microfinance deposit-taking institutions (MDIs) and two microfinance institutions (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 year and a repayment period of seven years.

MOST VIEWED

  • Phnom Penh placed in two-week lockdown

    The government has decided to place Phnom Penh in lockdown for two weeks, effective April 14 midnight through April 28, as Cambodia continues to grapple with the ongoing community outbreak of Covid-19, which has seen no sign of subsiding. According to a directive signed by Prime Minister

  • Cambodia on the verge of national tragedy, WHO warns

    The World Health Organisation (WHO) in Cambodia warned that the country had reached another critical point amid a sudden, huge surge in community transmission cases and deaths. “We stand on the brink of a national tragedy because of Covid-19. Despite our best efforts, we are

  • Hun Sen: Stay where you are, or else

    Prime Minister Hun Sen warned that the two-week lockdown of Phnom Penh and adjacent Kandal provincial town Takmao could be extended if people are not cooperative by staying home. “Now let me make this clear: stay in your home, village, and district and remain where

  • Vaccination open to foreigners in Cambodia

    The Ministry of Health on April 8 issued an announcement on Covid-19 vaccination for foreigners residing and working in Cambodia, directing the Ministry of Labour and Vocational Training and local authorities to register them. Health minister Mam Bun Heng, who is also head of the inter-ministerial

  • Ministry names types of business permitted amid lockdown

    The Ministry of Labour and Vocational Training singled out 11 types of business that are permitted to operate during the lockdown of Phnom Penh and Takmao town, which run through April 28. Those include (1) food-processing enterprises and slaughterhouses; (2) providers of public services such as firefighting, utility and

  • Culture ministry: Take Tuol Sleng photos down, or else

    The Ministry of Culture and Fine Arts has told Irish photographer Matt Loughrey to take down the photos of Khmer Rouge victims at Tuol Sleng Genocidal Museum which he allegedly colourised and altered to show them smiling. The ministry said Loughrey's work is unacceptable, affecting