Rak brings this vision of helping society by expanding access to credit to his new position as president of the Thai Credit Guarantee Corporation (TCG).
“I decided to apply to become president of the TCG after I had success in expanding the business of Export-Import Bank of Thailand to other Asean countries while I was senior executive vice president of the bank,” Rak said in an interview with The Nation Weekend.
“It is my passion to work with the TCG and find ways to collaborate with related parties to help small and medium-sized enterprises (SMEs). There are more than three million such enterprises nationwide that can benefit from loans, but only about one million of them managed to get loans from the banks.”
He also wants to open up channels for people who work in a freelance or casual capacity, such as taxi drivers, motorcycle taxi driver and online retailers, along with those who run street food and street stalls, to get bank financing with the help of loan guarantees from the TCG.
“In my view, TCG is a small state enterprise, as it has only about 400 workers. This give us the flexibility to carry out our work in supporting SMEs and micro SMEs to improve their business and achieve sustainable growth over the long term,” he says. “This is the main reason that I decided to resign from Export-Import Bank of Thailand and apply to serve here.”
Rak, 44, began working at the TCG on December 17, 2018; his term covers fours years.
“With my role at the TCG, it was the first time that I became the head of an organisation,” he says. “This presented a challenge for me in creating my own ideas for driving business growth and expanding the business, which is engaged in guaranteeing loans for all kinds of SMEs and Micro SMEs in the market.”
His goal is to open up the services of the TCG to everyone, providing them with the loan guarantees that secure the financing that they need. This support enables such people to create opportunities to learn how to better manage their businesses while using the borrowings to expand over the long term.
“Most people with small businesses cannot gain loans from the banks because they do not know how to manage their financial statements,” Rak says. “But we can help them to learn how to manage their financial statements, such as by doing their accounting and running check lists on their income and spending. In this way, we can help them to prepare a business plan based on their proposals, which they can present to the banks when applying for a loan. All this is provided in a service that we call Loan Clinic, where we effectively become their financial advisers.”
Rak says this open-door approach to doing business required an overhaul of the business model. Previously, the TCG sat back and waited for the banks to propose their customers for loan guarantees. That approach has now been reversed.
With the TCG acting as the applicants’ financial adviser, it advises them on how to gain loans from the banks and other financial institutions with loan products that match their needs.
“We are a partner with all the financial institutions. This means we have more choice for our customers in selecting what matches with their demands,” he says.
“This is the new model that we are implementing alongside our traditional model of dealing with customers that come from the banks. With this way of doing business, we believe that we will increase the growth in the number of new loan guarantees to between 20 per cent and 30 per cent a year from this year until 2022,” says Rak, referring to a timeframe that coincides with the year he is due to step down.
Under the business plan, the company will this year invest up to Bt200 million in upgrading its information technology (IT) system in line with the new business model. To meet customers’ demands, a further Bt300 million will be spent on digital technology development between 2020 and 2022.
With the upgrade of its IT system, the TCG will further reduce the processes involved in approving loan to just a single day next month. The process has already been reduced from 14 days to three days, he adds.
“The faster working process will increase our approval target for loan guarantees from an average of Bt88 billion in previous years to Bt115.5 billion this year,” he says. “It will also boost the number of our new customers from an average of 54,969 a year to 89,166 in 2019.”
“The TCG is also embarking on a reorganisation process. It has appointed PwC as its adviser on a business restructuring and the operational direction it will take for the future. These measures will drive the TCG forward as the top guarantor for both loan applicants and lenders in the country.”
In devising the new business model, Rak says he spent four months learning about the organisation’s work culture and he has sought to integrate the best aspects of the work culture into the business model while also striving to engineer change in the organisation.
“We are working together with the TCG staff and learning together on what we can achieve as the best outcomes,” he says. “This collaboration will help us in our efforts to change the business model and we hope to achieve our goals.”
Amidst all the hard work put in at the office, Rak says he manages to keep his weekends free for time with his family. He takes part in family duties like picking up his son for trips and enjoys the play time together. With this approach, he has succeeded in striking a balance between work and family life.
“In my view, when we have an opportunity to do business we have to be mindful to carry out such business with the aim of improving society and opening up opportunities for people to grow together,” he says. “It has been my quest, while progressing in my career to where I am now as the head of an organisation, to do what I can to serve society and drive forward the country’s growth.”