New Thai agency to underwrite SME loans, banks to pay in

Thailand’s Finance Ministry has asked the cabinet on May 13 to endorse a bill creating the National Credit Guarantee Agency, replacing the Thai Credit Guarantee Corporation and widening access to formal funding for 3.2 million small and medium‑sized enterprises, 40 % of which struggle to secure credit. The NaCGA would offer low‑fee loan guarantees financed by an initial 10 billion‑baht government injection plus annual contributions from commercial and specialised banks of up to 0.3 % of their domestic business‑loan books, a levy expected to be set lower once regulations take effect. Mandating bank payments aims to spur lenders to use the agency’s guarantees and cut their underwriting costs, with NaCGA assuming loan‑quality assessments. Industry sources say banks have previously avoided voluntary funding schemes for such guarantees.