umy documentsPhD PapersFINAL 4 Boocock Shariff SED.pdf (93.87 kB)
Loan guarantee schemes for SMEs - the experience in Malaysia
journal contribution
posted on 2011-03-08, 15:06 authored by Grahame Boocock, Mohd Noor Mohd ShariffGovernment-backed loan schemes have been introduced in many countries to enable
small and medium-sized enterprises (SMEs) to have access to funding at a reasonable
cost. This paper evaluates the schemes offered in Malaysia by the Credit Guarantee
Corporation (CGC). The introduction emphasises the importance placed on the SME
sector in achieving fully-industrialised status for Malaysia, and highlights the fact that the
CGC has been charged with a critical role in assisting SMEs. The paper then describes
the operation of the CGC and its place within the spectrum of finance aimed at SMEs,
before presenting the findings of an empirical review. Three key areas are explored: the
relationship between small firms, banks and the CGC; the level of finance additionality in
evidence; and the level of economic additionality generated. In each of these areas, the
CGC’s effectiveness in meeting the needs of SMEs, banks and the wider economy
appears to have been limited. The paper then describes a radical new Scheme
introduced by the CGC and assesses whether this Scheme will enable the CGC to
achieve its objectives, notably a greater degree of finance and economic additionality.
Finally, the implications of the CGC's experience for other developing countries are
summarised.
History
School
- Business and Economics
Department
- Business
Citation
BOOCOCK, B. and SHARIFF, M.N.M., 1996. Loan guarantee schemes for SMEs - the experience in Malaysia. Small Enterprise Development, 7 (2), pp. 25-36.Publisher
© Practical Action PublishingVersion
- AM (Accepted Manuscript)
Publication date
1996ISSN
0957-1329Publisher version
Language
- en