SMEs are considered to be an engine for growth in both developed and developing
countries, by generating employment opportunities, strengthening industrial linkages,
securing home markets and earning valuable export revenue. Government-backed loan
schemes play a major role in many countries, by enabling small and medium-sized
enterprises (SMEs) to access credit facilities. The Credit Guarantee Corporation in
Malaysia has been charged with this key role in assisting SMEs, and its main financing
instrument is the New Principal Guarantee Scheme CNPGS).
The overall aim of this thesis is to examine the extent to which the NPGS is appropriate
to the financing needs of Malaysian SMEs. The primary objective is to identify the factors
that determine the utilisation of the NPGS; utilisation depends upon a number of demand
and supply factors, as well as the characteristics of firms and owner-managers COMs). An
important secondary objective is to investigate the effectiveness of the NPGS, by
exploring the generation of finance and economic additionality, as well as the net cost of
the Scheme to the Treasury. [Continues.]
A Doctoral Thesis. Submitted in partial fulfilment of the requirements for the award of the degree of Doctor of Philosophy at Loughborough University.