IFC Provides $105 Million Loan to Boost Aid for Women-Led Businesses & MSMEs in Thailand

By: GWL Team | Wednesday, 5 July 2023

The International Finance Corporation (IFC) has granted a substantial $105 million loan to Thai Credit Retail Bank in an effort to bolster support for micro, small, and medium enterprises (MSMEs) in Thailand. Notably, at least 50% of the loan amount will be dedicated to women-owned or led MSMEs (WMSMEs), aiming to address the gender gap in accessing financial resources.

Thai Credit, known for its focus on MSMEs, will utilize the funds to provide assistance to MSMEs across Thailand. In particular, they will offer non-financial services specifically tailored to WMSMEs, including training programs and networking opportunities. By expanding its offerings, Thai Credit aims to empower women entrepreneurs and ensure their success in the business landscape.

MSMEs play a significant role in Thailand's economy, constituting 72% of the country's labour force and contributing 35% to the GDP. However, these enterprises often face challenges in obtaining financial support due to factors such as limited collateral, insufficient credit records, and perceived high business risk. The ongoing COVID-19 pandemic has further exacerbated these difficulties, disproportionately impacting WMSMEs.

Recognizing the importance of inclusive growth and post-pandemic economic recovery, IFC's partnership with Thai Credit aims to bridge the financing gap for underserved MSMEs and WMSMEs. In addition to the loan, IFC will collaborate with Thai Credit to develop financial products specifically tailored to WMSMEs and establish a Social Loan Framework adhering to internationally recognized principles.

Thai Credit has emerged as a key player in expanding access to financial services for nano and micro-entrepreneurs and MSMEs, effectively empowering those who have historically been overlooked by traditional banking institutions. Through extensive outreach efforts and strategic market presence, Thai Credit has successfully bridged the gap for underserved entrepreneurs, providing them with opportunities to access formal banking services in Thailand.

Winyou Chaiyawan, the Chief Executive Officer of Thai Credit, expressed his satisfaction with the collaboration, highlighting the bank's commitment to social responsibility and its core principle of "Everyone Matters." Roy Agustinus Gunara, the Managing Director of Thai Credit, also emphasized the bank's operational standards and social responsibility, which have attracted IFC's confidence in their business model and sustainability.

IFC's involvement in promoting financial inclusion in Thailand spans over two decades. The collaboration with Thai Credit aligns with IFC's strategic approach of deepening the social financing market in Thailand, supporting sustainable and inclusive economic recovery following the COVID-19 pandemic, and addressing the financing challenges faced by underserved MSMEs and WMSMEs.

By providing substantial financial support, tailored non-financial services, and expertise in developing financial products, IFC and Thai Credit aim to empower women entrepreneurs, drive inclusive growth, and create opportunities for small businesses, particularly those owned by women. Together, they are working towards building a more inclusive and resilient economy in Thailand.