Financing sector

Major Financing Programs of the Tokyo Metropolitan Government

The Tokyo Metropolitan Government (TMG) supports the smooth procurement of financing by small and medium enterprises (SMEs) via a range of programs established in accordance with the Credit Guarantee System. These programs include the "TMG SMEs Loan Program" and "New Guaranteed Loan Program Conducted in Cooperation with Regional Financial Institutions," etc.

Furthermore, with respect to venture companies, by leveraging the "Tokyo Metropolitan Venture Company Development Fund" that has been established in cooperation with private sector interests, etc., the TMG is able to supply such companies with funding necessary for growth, as well as offering them business support.

1. The TMG SMEs Loan Program

This program's establishment is based upon collaboration between the TMG, the Credit Guarantee Corporation of Tokyo (CGCT), and financial institutions. To small and medium enterprise (SME) owners generally felt to suffer from weak creditworthiness and financing procurement deficiencies, the program offers an opportunity to smoothly procure from financial institutions the funding required for business invigoration and stabilization, etc.

Based on the Credit Guarantee System established in accordance with the nationally-enforced Small Business Credit Insurance Act, etc., this is a program independently operated by the TMG via measures such as subsidizing guarantee fees and supplementing interest payments, etc. The TMG entrusts funding that represents the basis of loans to financial institutions, and the financial institutions carry out loans to SME owners in accordance with provisions set forth by the TMG. As a result of the SME owners receiving credit guarantees from the CGCT, they are supplied with funding.

Process from Loan Applications to Loan Execitions

* The loans record in FY2012 was 92,533 loans, amounting to a total value of ¥1.2799 trillion.

2. New Guaranteed Loan Program Conducted in Cooperation with Regional Financial Institutions

Financial support is offered through cooperation between the TMG and regional financial institutions (credit unions, credit associations, etc.) to those SMEs who, despite having high levels of technical expertise or superior business plans, etc., nevertheless experience trouble in securing the funding necessary to ensure the immediate continuation of their businesses.

This program has been established independently by the TMG to reinforce the "TMG SMEs Loan Program" (described above). The TMG entrusts those funds that represent the basis of loans to regional financial institutions, and support to the SMEs is carried out via the provision of low-interest loans, etc.

Process from Loan Applications to Loan Execitions

* SME owners can make loan applications to any one (1) of the financial institutions participating in this program, the applicable institution being one that, as is defined by the program, has already engaged in financing transactions with the SME in question over a certain period of time.
* The financial institutions handling the loan applications shall, based on screenings, apply for credit guarantees to the credit guarantors, and for those cases approved, loans shall be executed.
* As of the end of January 2014, there are some 24 regional financial institutions participating in this program (1 regional bank, 10 credit unions, and 13 credit associations).
* The loans record in FY2012 was 1,146 loans, amounting to a total value of ¥8.324 billion.

3. Tokyo Metropolitan Venture Company Development Fund

Through the "Tokyo Metropolitan Venture Company Development Fund," the TMG supplies funding and offers business support to growing venture companies.

Of the total value of ¥5.5 billion, the TMG has contributed ¥2 billion to the Fund, with input also received from the Organization for Small & Medium Enterprises and Regional Innovation, JAPAN; and certain private sector interests, etc. The Fund offers financing and business support to promising manufacturing venture enterprises (in areas related to energy, semi-conductors/ electronic components, medical equipment, and the environment, etc.). The Fund was established in January of 2013, and it is planned that financing activities will be conducted for approximately seven years thereafter. (However, there might be circumstances whereby the period of financing is curtailed).

Venture Company Development Fund   (Total ¥5.5 Billion)