When was KFK established, what does it do and what is its purpose?
Katılım Finans Kefalet A.Ş. was established on 29.03.2023 with the approval of President Recep Tayyip Erdoğan, through the partnership of the Ministry of Treasury and Finance, the Participation Banks Association of Türkiye and participation banks.
As an institutional guarantee organization, KFK provides access to financing, by acting as a “joint and several guarantor”, for Small and Medium-sized Enterprises (SMEs) and non-SME enterprises that cannot sufficiently benefit from various financing and support opportunities due to insufficient collateral.
Its purpose is to contribute to meeting all kinds of financing needs through guarantee schemes implemented in Türkiye and abroad, as well as newly developed schemes suited to our country's conditions, in compliance with participation finance principles and standards.
What is an SME?
The Regulation on Small and Medium-sized Enterprises entered into force upon its publication in the Official Gazette dated 25 May 2023 and numbered 32201.
According to the new regulation, an SME is defined as “an enterprise that employs fewer than 250 people annually and whose annual net sales revenue or balance sheet total does not exceed 500 million Turkish Lira.”
Is KFK a state institution?
KFK is a joint-stock company established under the Turkish Commercial Code. Its shareholders that are public institutions or deemed public institutions are the Ministry of Treasury and Finance, Emlak Katılım Bankası A.Ş., Vakıf Katılım Bankası A.Ş. and Ziraat Katılım Bankası A.Ş.
Its other shareholders are Albaraka Türk Katılım Bankası A.Ş., Kuveyt Türk Katılım Bankası A.Ş., Türkiye Finans Katılım Bankası A.Ş., Hayat Finans Katılım Bankası A.Ş. and T.O.M. Katılım Bankası A.Ş.
Who can benefit from KFK equity guarantees?
SME and non-SME enterprises, whether natural persons or legal entities, can benefit.
Can limits approved under KFK equity guarantees be used in tranches on different dates?
Guarantees provided from equity may be used in tranches, provided that this is within a specified period. Disbursing financing in tranches is at the discretion of the participation bank. All tranches must be disbursed within the guarantee utilization period.
Can SMEs with tax or social security (SGK) premium debts apply for a KFK guarantee?
At the time of the financing application, the beneficiary, the members of its Risk Group, and companies in which the beneficiary and/or its partners are shareholders, individually or jointly, must have no outstanding social security (SGK) or tax debts.
Can companies whose guarantee requests were previously rejected apply again?
Companies whose guarantee requests have been rejected must wait for at least one financial period to pass before submitting a new guarantee request.