CGC expects to guarantee RM2b in new loans

CREDIT Guarantee Corp Malaysia Bhd (CGC) expects to provide guarantee cover for RM2 billion in new loans this year.

Managing director and chief executive officer Datuk Wan Azhar Wan Ahmad sees the loan figures surpassing last year's, which was more than RM1 billion.

He said with the participation of five financial institutions, namely Alliance Bank, Standard Chartered Bank, OCBC Bank, RHB Bank and Public Bank, there will be more products in the pipeline for small and medium enterprises (SMEs).

"We'll provide 70 per cent guarantee cover on Alliance's Small Biz Express Scheme," he said at the signing of a strategic alliance agreement between CGC and Alliance Bank Bhd, here, yesterday.

With an initial RM50 million tranche size, the portfolio guarantee aims to help small businesses by providing loans for working capital and asset acquisition.

Wan Azhar said the minimum loan quantum under the portfolio guarantee is RM100,000 and the maximum is RM300,000 per SME customer for five years.

Under the scheme, SMEs do not need collateral or track record, he said.

"Our advantage is that CGC goes down to the smaller types of loan and the impact is greater in terms of the number of borrowers.

"Unlike commercial banks, our key performance indicators are number-driven and more focused on the growth of SMEs.

"There's no shortage of funds in the economy. What we do is to facilitate easier access of bank loans to small proprietors," he explained.

Alliance Bank head of SME banking Steve Miller said the bank may not be the biggest lender for the SME market but it aims to be the best.

"We want to always build a good relationship with our clients in terms of giving them the best products and services that they require," he said, adding that the SME loan business currently contributes to 25 per cent of the Alliance group profits.