Credit rating bureau to help speed up loans for SMEs

THE government has formed a unit that will rate Malaysia's small businesses to help speed up the bank lending process.

State-owned Corporate Guarantee Corp (CGC) has set up SME Credit Bureau (M) Sdn Bhd, which will compile the credit ratings of small and medium enterprises (SMEs).

SME Credit Bureau chairman Datuk Wan Azhar Wan Ahmad said ratings will be based on local data for all SMEs in the country.

"We provide financial institutions and other lenders with easy access to timely, accurate and reliable credit information on SMEs, thus help speed up the evaluation process," he said after the launch of SME Credit Bureau's corporate identity in Kuala Lumpur yesterday by Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz.

However, the credit ratings are not recommendations for banks to give or deny loans to SMEs.

"We do not make value judgements but we offer value-adding propositions. Our objective is to help them (SMEs) build a track record and financial standing," he said.

It will also help SMEs better understand their financial status and weaknesses.

"SMEs can use their positive credit history as 'collateral' to access loans at better rates and seek more competitive terms from different lending institutions," he said.

In the future, the bureau hopes to have information from other credit providers like suppliers and utility companies.

In conjunction with the launch, CGC signed a memorandum of understanding with Dun & Bradstreet Malaysia Sdn Bhd and ABM-MCD Holdings Sdn Bhd as joint-venture partners of SME Credit Bureau.

Earlier, Zeti in her speech encouraged SMEs to keep information that will enhance their access to credit.

"Consistent with the importance of the SME segment in the total loan portfolio, financial institutions should regularly interface with SME associations for financial services rendered to be more customised and meet specific requirements of the sector," she said.

(Source: http://www.btimes.com.my/Current_News/BTIMES/articles/smebiro2/Article/index_html)