Funding Societies Sees Strong SME Lending Opportunity in Government Supply Chains, Citing Liquidity Gaps Among Contractors and Suppliers

Funding Societies, one of Southeast Asia’s largest digital financing platforms for SMEs, sees a significant lending opportunity among businesses linked to government infrastructure projects and public procurement. These segments remain a core engine of Thailand’s domestic economy, even amid ongoing global volatility.

Vikas Jain, Country Head of Funding Societies Thailand, said SMEs play a critical role across government and state-owned enterprise projects, ranging from material suppliers and engineering service providers to construction firms and subcontractors. Collectively, they form the backbone of the country’s infrastructure delivery.

Projects led by government agencies and state-owned enterprises serve as a key driver of economic activity, supported by Thailand’s FY2026 national budget of approximately THB 3.78 trillion.* This reflects the scale of public sector demand across the economy. 

SMEs operating within these supply chains are generally supported by formal contracts with clearly defined delivery obligations and payment structures, enabling stronger revenue visibility and more predictable cash flow. These factors collectively underpin overall credit quality and support the timely execution of projects.

Despite the visibility of project revenues, cash flow remains a key constraint. Payment structures tied to project milestones require businesses to carry upfront costs for extended periods, covering labor, materials, and operating expenses, often months before receiving payment. As a result, liquidity has become a critical bottleneck, limiting both day-to-day operations and the ability to take on additional work.

A similar dynamic applies to certain procurement projects, such as one-off deliveries of machinery, equipment, or systems. While execution timelines may be shorter and payments received relatively quickly upon delivery, businesses still need upfront capital to procure goods and manage costs.

“Many contractors and suppliers have secured project pipelines, but must commit capital months in advance before receiving payment. Without the right financial tools, this can constrain cash flow management and growth,” Vikas said.

Against a backdrop of global uncertainty driven by geopolitical tensions, trade dynamics, and interest rate pressures, Funding Societies sees domestic investment, particularly in infrastructure and procurement by government and state-owned enterprises, as a key growth driver creating tangible opportunities for local businesses.

In response, the company is focused on providing working capital solutions aligned with SMEs’ operating cycles, helping to strengthen liquidity and ensure projects progress as planned.

Non-bank financing tools supporting this segment take several forms. Project financing enables contractors and companies awarded projects by government and state-owned enterprises to access working capital, using project contracts as part of the credit assessment process. Invoice financing allows businesses to convert receivables into short-term funding, improving liquidity rather than waiting for standard payment cycles. Meanwhile, purchase order financing enables businesses to leverage purchase orders to secure funding for raw materials or goods procurement, supporting production and service delivery. Funding Societies Thailand provides financing of up to THB 30 million per borrower to support liquidity needs within these project ecosystems.

The integration of technology and AI into credit assessment processes further enhances speed and reduces complexity, particularly through straight-through processing for businesses with complete data.

Across Southeast Asia, Funding Societies has disbursed more than THB 160 billion in financing to SMEs across multiple industries, including those connected to large corporate supply chains and government and state-owned enterprise projects, through over 5.2 million transactions.

In Thailand, Funding Societies has been supporting businesses involved in government and state-owned enterprise projects, including contractors, suppliers, and service providers across infrastructure and utilities, with continued growth as demand for working capital increases.

“SMEs involved in government and state-owned enterprise projects play a vital role in the economic system. Effective liquidity support not only enables business continuity, but also ensures project execution, job creation, and broader economic activity,” Vikas said.

“Looking ahead, domestic investment will further drive demand for working capital across the system. Developing financial solutions that align with SME business cycles will be critical to sustaining overall economic momentum,” Vikas concluded.
For more information ,please visit https://fundingsocieties.co.th/

Reference :

*https://english.news.cn/asiapacific/20250902/9369edcefe664d21bbe4d9bb146e9f88/c.html / https://www.thaipbs.or.th/news/content/356691