BUSINESS

CGC PROVIDES GUARANTEES TO MORE THAN 330,000 SMES AS AT 2017

03/12/2018 08:07 PM

KUALA LUMPUR, Dec 3 (Bernama) -- Credit Guarantee Corporation Malaysia Bhd (CGC) has provided guarantees worth RM67.1 billion to more than 330,000 small and medium enterprises (SMEs) since its establishment on July 5, 1972 until end-2017, said the Auditor-General’s 2017 Report (Series 2).

The CGC had been managing 17 guarantees and four financing schemes in 2017 to helping SMEs with business potential, according the the report’s Management of Government Companies and Federal Government Agencies tabled in Parliament today.

The report found that as at 2017, CGC’s total write-offs amounted to only RM8.47 million (0.8 per cent) whereas the outstanding collections amounted to RM1.04 billion. 

On CGC’s full risk guarantee scheme, the report reported that the accumulated non-performing loan/ non-performing financing (NPL/NPF) exceeding three months in 2017 was still high at 78.6 per cent (RM365.74 million) and involved 879 SMEs.

For the direct financing scheme, the number of SME applications approved showed a downward trend in 2015, 2016 and 2017 at 75.7 per cent, 54.7 per cent and 41.7 per cent, respectively, even though the number of applications received exceeded the target.

“The collection target for the direct financing scheme was not set and the NPL/NPF collection rate in 2017 was 43.6 per cent totalling RM154.58 million (640 SMEs), while the total bad debt written off under this scheme was only RM12.21 million (involving 60 SMEs),” the report said.

From 2015 to 2017, the report found that the management of the direct financing scheme did not achieve high efficiency even though the CGC managed to collect RM1.86 billion (74.3 per cent) of the RM2.5 billion disbursed.

The Auditor-General’s report also made several proposals to improve the CGC’s performance and ability to meet it objectives, such as increasing the number of approvals for SMEs in the full-risk guarantee scheme so that more SMEs could benefit from the scheme.

“The CGC also needs to attach the repayment schedule to the government loan agreement so that payments can be made on a regular basis,” the report added. 

The audit on the CGC was carried out from November 2017 until February 2018.

-- BERNAMA


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