Thai Credit Retail Bank (TCRB), a Thailand-based bank that offers financial services to small and medium-sized enterprises (SMEs) and retail customers, is eyeing to enter microfinance sector in 2014.
The move by the lender came after the Finance Ministry and the Bank of Thailand recently agreed to allow lenders to apply for microfinance licences from early 2014.
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By entering microfinance sector, the lender is aiming to increase its small-business lending from the current 18% to over 60% or THB10bn ($311.8m) in the next three years.
The microfinance loans will allow low-income earners to get access to official funding sources, claims the lender.
TCRB managing director, Roy Agustinus Gunara, was quoted by Bangkok Post as saying that their small-loan clients are largely self-employed business owners with collateral, while microfinance borrowers would be vendors who have no collateral.
"Knowing the customers’ loan purpose and their debt payment ability are important to control risks," Gunara added.
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By GlobalDataTo support the growth of the new sector, TCRB is also setting up new lending offices in local areas that will offer only loans.
TCRB, which currently has five lending offices, plans to open around 20 commercial and community lending offices in 2014.
