The state-owned Small and Medium Enterprise Bank of Cambodia Plc (SME Bank) has disbursed some $418 million in loans to at least 3,185 small- and medium-sized enterprises (SME) since its foundation, as of October 31, to keep them from going under during the height of the Covid-19 crisis, and subsequently to help them reopen and expand post-pandemic, according to its CEO.
The bank was established in February 2020, and lends directly and through co-financing schemes with 33 participating financial institutions (PFI) at present.
SME Bank CEO Lim Aun told The Post on November 21 that, as of October 31, only 22 of the PFIs have disbursed loans to customers under the state-owned enterprise’s co-financing schemes, contributing $187 million, or nearly 45 per cent of the total credit provided.
“Lending to SMEs is very important, as a lifeline for them to start up again post-Covid-19. Many businesses shuttered, and [we] offer them a chance to maintain and strengthen their operations.
“This is a government financial-support initiative for SMEs,” he said, noting that the manufacturing and processing sectors accounted for a considerable share of the businesses aided by SME Bank.
Cambodia Chamber of Commerce (CCC) vice-president Lim Heng ascribed SME Bank’s apparent success to direct visits to businesses looking for a loan.
“The bank has been an important boon for business activity among SMEs through its credit provision,” he told The Post on November 21.
“Nonetheless, I believe that this amount may still be a bit on the light side, bearing in mind that SMEs require lots of money, especially those in the agricultural sector, they need the resources to procure produce such as paddy rice for stock, or for processing.
“With greater access to capital for SMEs, such as through low-interest loans, things would be better,” Heng added.
Speaking to The Post on November 21, Royal Academy of Cambodia economics researcher Ky Sereyvath commented that SME Bank is actively supporting the revitalisation and sustainability of the small businesses that weathered the Covid storm.
Aside from delivering much-needed capital for SMEs to “grow even better”, the bank “also provides business-specific techniques, analyses and in-depth studies”, he said.
SME Bank’s Aun reported that a total of $33.7 million in loans have been disbursed to 251 tourism-related enterprises under the $150 million Tourism Recovery Co-Financing Scheme (TRCS), in the July-October period.
Using previous SME Bank figures for reference, this means that October accounted for 25 per cent of the five-month total, and that 62 new enterprises received loans that month.