What We Work

The Lao Credit Guarantee Sole Company Limited symbolizes the company’s core mission in financial security, risk sharing, and support

Credit Guarantee Process

The guarantee process can only begin once the bank (lender) has considered approving the initial credit. This is to ensure that the decision-making and control of the credit remains with the lender.

Step Description
Step 1 Loan Application The Entrepreneur (SME) prepares documents and a business plan to apply for a loan directly with a Partner Financial Institution (PFI).
Step 2 Bank Evaluation and Approval The PFI analyzes the business feasibility and considers approving the loan (BANK LOAN approved) according to the bank's conditions.
Step 3 Guarantee Request Once the loan is approved, if additional collateral is required, the PFI submits a guarantee application form to LCGC.
Step 4 Issuance of Guarantee Letter LCGC evaluates the application. Upon approval, LCGC issues a Credit Guarantee Letter and sends it back to the PFI.
Step 5 Loan Disbursement Upon receiving the Guarantee Letter from LCGC, the PFI proceeds to disburse the loan to the Entrepreneur (SME) for business use.

Repayment and Debt Collection Process

(Default on a Payment)

Order of Recovery Funds Deduction
  • 1 Debt collection expenses
  • 2 Outstanding interest not exceeding 365 days
  • 3 Principal amount of the loan
  • 4 Fees or other expenses
Note:
The bank continues debt recovery; after deduction, the remaining portion (if any) is sent to LCGC.
Unsecured Credit Guarantee
🛡️
Guarantee Limit (70%) LAK 700,000,000
🧮
First Year Guarantee Fee LAK 10,500,000
(1 Billion x 70% x 1.5%)
📅
Subsequent Year Guarantee Fee 1.5% of Outstanding Principal
(Outstanding Balance x 70% x 1.5%)

Financial Guarantee Models For Micro, Small and Medium Enterprises (MSMEs)

SME Borrower & Bank
SME Illustration
SME Loan Request from PFI
(No Collateral Required)
LAK 1,000 mil
Unsecured Guarantee Coverage
🛡️
Credit Guarantee by LCGC LAK 1,000 mil
🧮
1st Year Guarantee Fee: LAK 1,000mil x 70% x 1.5% = LAK 10.5mil
%
Subsequent Years Fee: Outstanding Bal. x 70% x 1.5%

Credit Guarantee Example (With Collateral)

Frequently Ask Question

Contact Us If You Need Immediate Assistance

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