1. Credit Supplementation for SMEs: Thailand Case Study
35th ADFIAP ANNUAL MEETING, ISTANBUL, TURKEY
35th ADFIAP Meeting
Istanbul, Turkey
Credit Supplementation for SMEs: Thailand Case Study
Mr. Wiboon Perm-Arayawong, President
Thai Credit Guarantee Corporation (TCG)
Apr 25, 2012

2. Presentation Outline 3. CURRENT 4.STRATEGIC DIRECTION 2. DEVELOPMENT
1. ABOUT US
Thailand & Credit Guarantee System
Thai Credit Guarantee Corporation (TCG)
2. DEVELOPMENT
Development, Outreach, Additionality, & Sustainability
Lesson Learned
3. CURRENT
CHALLENGES
SMEs, Banks , & TCG
Government
4.STRATEGIC DIRECTION
Vision & Strategies
Strategy Map

3. Thailand
Area (km2)
513,120
GDP (mil USD)
318,522
GDP-PPP (USD)
4,150
Population (mil) 69
No. of Enterprises
2,924,912
No. of SMEs
2,913,167
% to Population
4.21
% to Total Ent.
99.59

4. Thai’s Credit Guarantee System4
Loans disbursement 6
Claim payment
Public Policies, Capital and Loss Compensation
Letter of Guarantee issue 3
Bank
SMEs 2
Application for Guarantee 5 1
Loan requests
Claim submission when legal action is taken against the borrower.

5. Thai Credit Guarantee (TCG)
Chiang Mai
Phitsanulok
UdonThani
Nakhon Ratchasima
Chonburi
Ayutthaya
Suratthani
Songkhla
Bangkok and Greater Bangkok Office
A state-owned specialized financial institution (SFI) under the supervision of the Ministry of Finance.
Established on December 30, 1991 as the sole Credit Guarantee Corporation in Thailand to assist viable SMEs to access to finance.
There are 9 Offices covering all regions throughout Thailand.

6. Annual SME Outreach
(Million THB)
No. of Guarantee Issued

7. Statistics of Credit Guarantee & NPG (FY 2003-2011)
(Million THB)
Cumulative Approved Guarantee
Outstanding Guarantee

8. Percent of Outstanding Guarantee to Total SME Loan
(%)
(Mil. THB)
3,291,750
2,906,745
2,853,907
2,732,149
2,774,714
2,608,806
2,494,084

9. ADDITIONALITY
108 66 44 41 34 27 19 15
2003
2004
2005
2006
2007
2008
2009
2010
2011
Accumulated
Job Creation
Cumulative Approved Loan Guarantee

10. Financial Sustainability
Annual Net Income
Retained Earnings

11. 1.5 Lesson Learned
Thailand had lost opportunity to assist SMEs to access to finance effectively for 17 years with individual guarantee only.
Portfolio guarantee scheme was proved to be more effective than individual guarantee
Partial credit guarantee (PCG) is an effective public support scheme for crisis-response.

12. Thai SMEs

13. OUTSTANDING LOAN OF ALL BANKS
Billion THB (Exchange Rate 30 THB/USD)
5 Yrs Avg. Growth Rate:
Large % p.a.
Medium 8.8 % p.a.
Small % p.a.

14. NUMBER OF BORROWERS

15. 2 /3 of SMEs Don’t Borrow from Banks
How did this 2 million SMEs finance themselves?

16. Target SMEs
Ration of SMEs (classified by group) from the total number of SMEs in Thailand (approximate 3 million SMEs)
Group 6
Group 1
Group 5
Group 2
Group 4
Grou p 3
Guesstimate 600,000 SMEs
Source: In 2009, OSMEP estimated the total number of SMEs throughout Thailand at 2,914,912 SMEs.

17. BANKS’ SME LOANS

18. CURRENT LOAN GUARANTEE
% Guarantee to Their SME Loan
% Guarantee to Their SME Loan

19. Strategic Direction Vision
Be the well recognized national credit guarantee institute
Mission
Assist SMEs to access to finance
Increase banks’ confidence to lend to SMEs
Strategies
Full market coverage strategy
Integrated marketing communication strategy
Collaborative strategy

20. Strategy Map Financial Perspective Customer Internal Learning & Growth
Growth Strategy
Productivity Strategy
Risk Based Pricing
New
Customers
New Products & Services
Penetrations
Reduce cost
to serve
Minimize
NPGs
Maximize use of
Existing Assets
OPERATION MANAGEMENT PROCESSES
CUSTOMER MANAGEMENT PROCESSES
INNOVATION
PROCESSES
REGULATORY & SOCIAL PROCESSES
HUMAN CAPITAL
INFORMATION CAPITAL
ORGANIZATION CAPITAL
Credit Guarantee
Management
Friendly
Risk Management
Targeting
Recovery
Growth
Acquisition
Retention
Identify New Opportunities
to Serve Customers
Anticipate Future
Customer Needs
Corporate Governance
Corporate Social
Responsibility
A CAPABLE, MOTIVATED, AND TECHNOLOGICALLY ENABLED WORKFORCE
Values
Skills
Knowledge
Core Credit Guarantee Solutions
Decision Support System
Infrastructure
Culture
Leadership
Alignment
Teamwork
PROVIDE THE BEST TOTAL SOLUTION TO OUR CUSTOMERS
IMAGE
Fast
Convenience
Reliable
Consultant
Training
Partner
National Credit Guarantee Institute
PRODUCT / SERVICE ATTRIBUTES
RELATIONSHIP

21. Thank You