Logo of Phnom Penh Post newspaper Phnom Penh Post - SME loan talks in progress

SME loan talks in progress

SME loan talks in progress

UNDP and International Trade Centre in discussions with major banks over proposed lending to agriculture SMEs

The UN Development Programme (UNDP) and the International Trade Centre (ITC) are in talks to recruit three major banks to participate in a programme that would provide loans to 100 small and medium-sized agriculture enterprises.

UNDP Assistant Country Director Wisal Hin said Thursday that he expected formal agreements to be reached with two or three of the banks by October.

"When we have partnerships with the banks, the loans will begin in October of this year, and 100 agriculture-related small and medium enterprises will be selected for the loans," said Wisal Hin.

He said the programme, titled "Access to Finance for SMEs", would last 18 months and be part of an effort to help export-oriented small and medium-sized enterprises (SMEs) get loans. He said he could not provide information about rates.

He added that the French Development Agency (AFD)would guarantee the loans and that the programme would not require all recipients to put up collateral.

A business survey released in April by the International Finance Corporation and the Asia Foundation found that 96 percent of Cambodian businesses were micro-enterprises, but that the "number of business with between 10 and 20 employees has nearly doubled over the past two years, while those with over 20 employees grew by almost 200 [percent]".

When we have part-nerships with the banks, the loans will begin in October.

Commerce Minister Cham Prasidh said at a launch event in late May that up to 80 percent of Cambodian SMEs had never received a bank loan.

Wisal Hin said the three banks participating in the discussions were ACLEDA Bank, ANZ Royal Bank and Cambodian Public Bank.

So Phonnary, ACLEDA's executive vice president and chief of operations, said Thursday that the bank had been approached to participate, but that no agreement had been reached.

"We're interested ... because now the bank has strong liquidity so we can support any loan project," she said.

She said ACLEDA had deposits of US$596 million as of Thursday, up from $487 million at the end of 2008, adding that loans totalled $442 million.  

Stephen Higgins, CEO of ANZ Royal Bank, declined to comment on the programme except to say the bank was "still in discussions with UNDP and the ITC".

Ong Ming Tech, deputy general manager of Cambodian Public Bank (CPB), said Thursday that he was not aware of the programme and referred questions to Country Director Phan Ying Tong, who was unavailable.

MOST VIEWED

  • US to ramp up sanctions after ‘flawed’ national polls

    At a press conference on Wednesday, the US State Department announced that it would expand visa sanctions on the Cambodian officials and individuals it deems responsible for “undermining democracy” in Cambodia. At the briefing, spokesperson Heather Nauert reiterated that the department regarded the July 29 elections

  • Final poll results confirm first single-party Assembly

    IN an unprecedented situation in Cambodian politics, the official results of the July 29 national elections have declared that the Cambodian People’s Party (CPP) will take all 125 seats in the National Assembly on the back of it receiving 76 per cent of the votes. The National

  • PM's Bodyguard commander hits back at US

    The commander of Prime Minister Hun Sen’s Bodyguard Unit (BGU) Hing Bun Heang on Sunday dismissed a short video clip that went viral on social media in which he says he is preparing for a war with the United States over its aggressiveness towards

  • Chinese influence to sweep Kingdom?

    Growing Cambodia-China ties have seen the latter’s influence sweep across the Kingdom through increased investments and tourism. The Asian giant has become the leading source of foreign funds in Cambodia, fuelling the construction sector with huge casino and hotel projects. Much of the growth