Myanmar to Establish Credit Guarantee Corporation

Union Minister of Planning, Finance and Industry U Soe Win revealed during a January 22 meeting with local micro, small and medium enterprises that the ministry is working to form a credit guarantee corporation to help MSMEs get access to financial services.

The ministry is working in collaboration with the Central Bank of Thailand to establish such an entity under the Myanmar Sustainable Development Plan (MSDP) 2018-2030.

The credit guarantee corporation will be tasked with providing loan services to SMEs in accordance with government policy and instructions, as well as monitoring investments and managing loan defaults to prevent losses.
The body will also help MSMEs to expand their businesses by offering credit guarantee services.
The interest rate for SME loans, USAID CGI loans and Shop Owner loans is 13 percent while working-capital loans and JICA loans are granted at 12 and 8.5 percent per annum.

The ministry is also drafting an MSME Master Plan with the help of microfinance institutions, nongovernment financial institutions and Germany’s FNF foundation, with completion date set for this month.
The first draft, completed during the first half of 2018, was revised by government agencies and MSME representatives in line with the MSME Development Strategic Plan 2016-2025 and ASEAN SME Policy Index 2018.

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Source : Myanmar Business Today

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