Plans are underway to start a credit guarantee corporation for mortgages after the government enacts the Small- and Medium-Sized Enterprise (SME) Development Law, said Aye Aye Win, the deputy director of the Ministry of Industry.
The ministry would introduce a credit rating system in order to implement credit guarantee support. The insurance corporation has been established to help the credit rating system.
“The credit rating system will also be put into practice by the Ministry of Finance. Insurance will be offered after rating the property. The situation and prospects of SMEs will have to be studied,” Aye Aye Win said.
Similar systems to the credit guarantee corporation were in operation in most of the countries, he said. In Myanmar, the SME bill has been approved by the Upper House but the Union parliament has yet to pass it.
“As soon as the law has been enacted, we can perform innovation and creative funds. The credit rating system needs the credit guarantee corporation,” Aye Aye Win said.
The insurance premium will be paid at 3 percent interest for the first year, 2 percent for the second year and 1 percent for the third year.
Source: ELEVEN MYANMAR