There has neither been a follow-up project in the Philippines, nor has ADB financed a similar project elsewhere in the Asia Pacific region. The issue of taking on SME risk against that of the financial intermediary needs resolution before its further application. The PCG facility could potentially be adopted in a number of ADB’s developing member countries, but further work is required to adequately measure and assess the risk-return benefits of the instrument for stakeholders. Many variations are possible, such as different stop-loss levels; differentiated risk sharing; financial instruments for different uses (e.g., trade financing, equipment purchases, and other capital investment); and working capital. Some of these adjustments can be explored to assess whether the PCG can be made more flexible and better tailored to local conditions.
Small and Medium Enterprise Development Support Project