The government plans to use the Ministry of Finance’s Small and Medium Enterprise Credit Guarantee Fund and the Tourism Development Fund to help hoteliers secure up to NT$10 billion (US$319.7 million) in bank loans, Minister of Transportation and Communications Lin Chia-lung (林佳龍) said yesterday.
“The tourism industry is facing many challenges and we should offer them our support. We invited officials from the Ministry of Finance, the Financial Supervisory Commission and the Bankers Association so that together, we can help boost the tourism industry’s development,” Lin said after presiding over a meeting to explore the possibility of using the two funds to provide loans to tourism operators.
“Hoteliers can now apply for loans from the NT$10 billion backed by the Small and Medium Enterprise Credit Guarantee Fund,” he said, adding that the bank loans would be available soon after administrative procedures are completed.
Photo courtesy of the Tourism Bureau
A source familiar with the matter said that Lin came up with the proposal after meeting with tourism industry representatives last month, many of whom talked about the difficulty travel operators face in securing loans from banks, which see tourism as a high-risk industry.
They also told Lin that it is difficult for hoteliers and travel agencies to secure investment to upgrade and transform their businesses, the source said.
Lin then briefed Minister Without Portfolio Chang Ching-sen (張景森) at a Cabinet meeting last week about their concerns, and he was given the green light to coordinate government agencies to set up the proposal, the source said.
At the meeting yesterday, it was decided that there should be a new set of rules governing hoteliers’ applications for bank loans backed by the credit guarantee fund, the source said.
Before Dec. 31, 2021, the Tourism Bureau is to take NT$500 million from the Tourism Development Fund and give it to the credit guarantee fund, the source said.
The Financial Supervisory Commission, the Ministry of Finance and the Bankers Association are to be in charge of promoting the program among banks and financial institutions, while the Ministry of Economic Affairs’ Small and Medium Enterprise Administration is to offer consulting services for debt settlements for tourism operators, the source said.
Participants at the meeting also agreed to change the rules governing the provision of low-interest loans to tourism operators, such as extending the debt repayment period to help them cope with the decline in Chinese tourist numbers in the short term.
Since 2002, the rules governing the provision of low-interest loans to tourism operators have helped provide funding to 245 hoteliers, tourist amusement enterprises and travel agents. Under the rules, loans given to these operators totaled NT$10.6 billion, data showed.
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