Turkish credit fund backs nearly half million businesses since 2017

Turkish credit fund backs nearly half million businesses since 2017

ANKARA
Turkish credit fund backs nearly half million businesses since 2017

Turkey’s Credit Guarantee Fund (KGF) provided guarantees of 227.3 billion Turkish Liras (some $60.6 billion) and credits of 255 billion liras (some $68 billion) to 467,776 businesses since the beginning of 2017, the fund’s general manager said.

“It is a success story that the system has reached so many businesses,” İsmet Gergerli told Anadolu Agency on May 29.

He stressed the KGF was restructured at the end of 2016 to provide accessing finance to the real sector with relevant term and cost.

Some 75 percent of all guarantees and credits was used by SMEs, while the KGF made nearly 40 billion liras (some $10.7 billion) guarantees available for exporting companies, he said.

“When we look at the sectors, 49.6 percent [$30.1 billion] of guarantees was used by commerce sector, 32.1 percent [$19.4 billion] manufacture, 12.4 percent [$7.5 billion] construction, 3.1 percent [$1.87 billion] agriculture, and 2.8 percent [$1.65 billion] tourism,” said Gergerli.

“There is no problem in returning. While the non-performing loan rates ratio to normal loans is 2.9 percent normally, the ratio is 0.6 percent in KGF loans,” he added.

Gergerli noted that the KGF provides relevant cost, long-term and low-interest rate for business loans and reduces the number of walk-out check and bills.

He also said the KGF is operating in cooperation with several institutions such as the European Bank for Reconstruction and Development, the Islamic Development Bank, and the European Investment Fund.

The fund recently signed a 300 million euro loan deal with the EBRD to support women entrepreneurs.

The KGF—founded in 1991—facilitates access to the financing of all enterprises to provide support to the growth and development of Turkey.

credit guarantee fund, Turkey, economy