Description of Services

Risk Management, Policies and Procedures

  • Guarantees will be offered for up to 50% of the principal of loans to MSMEs (the lender could take a guarantee for a lower percentage)
  • Only new loans will be eligible for coverage. Issuance of guarantees to cover refinancing or restructuring of loans will not normally be allowed, as the program is intended to make available new financing to MSMEs, rather than assist financial institutions with problem loans
  • Guarantees will be issued for principal only. ¬†They will not cover interest or other amounts owed to or other costs incurred by the lender;
  • The lending financial institution will apply their own regular credit approval criteria and determine the loan terms and conditions
  • New loans to existing clients will be eligible for coverage
  • Long term, investment loans (for purchase of machinery, equipment, technology and real estate in connection with business operations such as finance of business premises, e.g. factory buildings), as well as loans for working capital purposes, will be eligible for guarantee coverage
  • KCGF will aim to diversify its exposure among different industries, whenever possible

Borrowers must have business registration and fiscal numbers, and eligible legal forms will include:

  • Limited liability companies
  • Joint stock companies
  • Sole proprietorships
  • Cooperatives
  • Partnerships
  • Guarantees will be issued for loans to MSMEs only, defined for purposes of KCGF as privately owned businesses with no more than 250 employees at the time of the loan application