CGC Aims to Enhance Its SME Outreach via Bank Rakyat
KUALA LUMPUR, July 24 – Credit Guarantee Corporation Malaysia Berhad(CGC), Malaysiaís leading credit enhancer to the small and medium enterprises (SME), announced today that it has signed a Memorandum of Understanding with Bank Rakyat to further expand its outreach to the SMEs and promote the growth and development of this sector in Malaysia.
CGCís Chief Executive Officer, Datuk Wan Azhar Wan Ahmad said that the strategic collaboration with Bank Rakyat is expected to pave the way for CGC to bridge the gap further in terms of SMEs access to financing.
He further added that the presence of institutions such as CGC and development financial institutions(DFIs) like Bank Rakyat complement the banking institutions in meeting the financing requirements of the economy, particularly in supporting the economic and social development of the nation.
ìFor CGC, this strategic collaboration would enable it to widen its outreach to a completely new clientele base, reachable through Bank Rakyatís more than 100 branches nationwide while the SMEs will enjoy the availability of another new avenue to secure financing for their business,î he added.
In going forward, CGC will continue to explore strategic partnership with other DFIs to further expand its outreach to the SME community and provide support to as many sectors as possible especially the least supported ones that are significant to the nationís economic growth.
Early this year, CGC forged strategic alliances with eight Islamic financial institutions to further enhance its outreach to the SME community, in particular those that require Islamic financing. To date, this alliance has benefited SMEs with credit guarantees valued close to RM8 million. It has also forged strategic alliances with two DFIs namely MIDF and Bank Pertanian Malaysia and thus far approved close to RM16 million loans, benefiting about 250 SMEs in the first six months of 2007.
ìCGCís expansion of credit enhancement to the Islamic financial institutions and the DFIs is a timely response to the increasing demand for financing by SMEs, which is fuelled by the expanding economy projected to grow at about 6%,î he said.
CGC has also forged strategic alliances with several benchmarked foreign institutions such as global fund manager Aureos Capital and Dun & Bradstreet Malaysia Sdn Bhd, a worldwide operator and provider of credit bureau and risk management solutions, to tap into their expertise especially in equity financing and SME credit bureau services respectively.
In addition to that, CGC had participated in the first ever SME loan securitisation in Malaysia launched in May 2007. This would enable CGC to secure funding for the SMEs from the capital market through the issuance of bonds, asset securitization and collaterised loan obligation.
ìWith these strategic partners on board, CGC is adequately positioned to innovate and introduce new products, reflecting its commitment to expanding avenues for SMEs to enhance their access to credit facilities,î he added.
Since its establishment in 1972, CGC, a subsidiary of Bank Negara Malaysia, has remained focused in its mandated role to assist SMEs accessibility to credit facilities. To date, CGC has been instrumental in the establishment of more than 365,000 SMEs, having cumulatively guaranteed about RM36 billion.
24-Jul-2007 15:24:04 PM