Small and medium enterprises (SMEs) and tech start-ups could more easily access funding sources thanks to a rating system developed by the Thailand Technology Rating System (TTRS) and initiated by the National Science and Technology Development Agency (NSTDA).

A successful business-rating system from Korea’s Technology Finance Corporation (KOTEC) has been tailored for Thailand, thanks to the NSTDA joining forces with the Thai Credit Guarantee Corporation (TCG). The Thailand Technology Rating System (TTRS) will aim to help SMEs and start-ups to more easily get funding.

KOTEC is a quasi-governmental institution providing guarantees, based on technology appraisals, to SMEs that are technologically competent but lack collateral.

Narong Sirilertworakul, president of the National Science and Technology Development Agency (NSTDA) said that the organisation on March 1 launched the Thai technology rating system after a successful trial period in which they evaluated some companies.

With the launch of TTRS, which incorporates the KOTEC rating system, tech start-ups and SMEs will be evaluated for their suitability for funding.

TTRS will consider four pillars – founders, technology, market opportunity, and company finances. Some 40 factors are evaluated under the four pillars. Those that excel in the evaluation will be given TTRS certification valid for a year.

“Companies can use TTRS certification to more easily do fundraising. TTRS will help the country’s tech start-ups be more complete,” said Narong.

“Bankers will be also benefit since they will have us as an assistant helping them to evaluate products and services as well as the business end of tech-based SMEs and start-ups, while SMEs and start-ups can more easily access additional sources of funds.”

Meanwhile, the Thai Credit Guarantee Corporation (TCG) has prepared to submit the TTRS proposal to the government, along with a budget request of Bt500 million. Their contribution will be to give a “guarantee rating”, along with a credit guarantee of Bt10 million, for companies winning TTRS certification.

The credit guarantee corporation aims to help up to 50 SMEs and start-ups get the credit guarantee within the next 12 months.

Under the collaboration, NSTDA will utilise its researchers and resources to evaluate technology and market potential while TCG will evaluate the financial pillar.

“We are talking with The Thai Bankers’ Association about further collaboration with TTRS,” said Narong. Once banks accept TTRS certification, SMEs and start-ups will be more likely to seek the TTRS certification, which will in turn help them get funding.

Eventually, it helps the whole ecosystem,” he said.

He said NSTDA hopes to see TTRS succeed as a key driver helping tech companies in Thailand, in parallel to KOTEC’s success in South Korea. KOTEC evaluates 400 to 1,000 companies yearly, with the studies ranging from simple to complex technology.

“KOTEC spend only one week for the whole evaluation,” said Narong. “For TTRS, we will spend two weeks to get SMEs and start-ups certified. With our strength, we have multidisciplinary technology knowledge with over 600 PhDs. We really hope to be a key driver for Thailand’s technology industry moving forwards and become the key industry driving the country’s economy.”

He added that their multidisciplinary technologies knowledge allows for evaluating a wide range of technologies, including biotechnology, materials technology, nanotechnology, and others. They will not be limited to evaluating only computer technology companies.

“In fact, TTRS can help not only SMEs and start-ups. The system has been developed and tested to evaluate the enterprise as well,” said Narong.

TTRS will help draw investment money into the country’s tech industry, Narong said, because many non-bank investors will feel more confident in tech companies and will move their money to invest in the TTRS-certified tech companies.

“TTRS will be the key mechanism to fill in the [knowledge] gap between tech companies – both SMEs and start-ups – and investment. We hope TTRS will help open more investment opportunities for the investors while help creates more numbers of investors,” said Narong.