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Published on October 9, 2007

It will help raise cash for small- and medium-sized enterprises (SMEs).

KBank launched its K-SME venture-capital fund, too. Khao Kla will manage that. It is owned by Kasikorn Asset Management.

The fund will invest in SMEs with high growth potential but cash shortages. The fund has initial capital of Bt200 million and plans to spend between Bt100 million and Bt150 million in its first year.

Bank executive vice president Boontuck Wungcharoen said many SMEs lacked operational cash, because of their rapid growth.

"With a shortage of working capital, many SMEs borrow from underground creditors. They are charged high interest and this is a barrier to business," he said.

The fund will invest in companies that have fixed assets excluding land amounting to less than Bt200 million, fewer than 200 staff and been in operation for more than three years.

It expects company owners to have accumulated more than five years' experience in their individual sectors. Owners must have a personal investment that exceeds that of the fund.

The companies may not list on either of the stock exchange's two boards.

The fund will invest 10-50 per cent of a company's registered capital for a maximum of five years. It will be a passive investor.

Somruedi Banchongduang, The Nation