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Japan credit guarantee system

Confidence: Likely Updated 2026-05-25 Review by 2026-11-25 Sources 7 Machine-translated Original (JA)
#policy-finance#credit-guarantee#sme-finance#public-credit#jfc#zerozero-loan
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This entry sits under policy-finance index as the SME-finance mechanism page. Read it against Japan Federation of Credit Guarantee Corporations (JFG) for the coordinating-body view, Japan policy finance system for the broader perimeter, and the sector-specific counterparts agriculture / fisheries. Local examples include Hokkaido CGC, Tokyo CGC, Osaka CGC, Aichi CGC, and Hyogo CGC.

TL;DR

Japan’s credit guarantee system (信用保証制度) is the public-credit infrastructure that supports SME and small-business funding in Japan. It is a layered system: (1) 51 prefectural / city-level 信用保証協会 (Credit Guarantee Corporations, CGCs) guarantee eligible SME borrowing from financial institutions; (2) the 全国信用保証協会連合会 (JFG) coordinates the 51 CGCs and pools the responsibility-sharing burdens; (3) the 信用保険 (credit insurance) layer is operated by Japan Finance Corporation (JFC), which reinsures CGC guarantees so that final residual loss falls on the public-credit infrastructure rather than collapsing the CGC layer. Together this is the 信用補完制度 (credit-supplementation system). It is not a single lender; it is a public-credit architecture. The 2020–2022 ZeroZero loan (実質無利子・無担保融資) special program ran through this system and continues to unwind into 2024–2026 in subrogation cycles.

1. System architecture (the 信用補完制度 stack)

LayerRoleFinWiki route
SME / small-business borrowerApplies for business funding through a financial institution and guarantee route.System route here
Financial institution (lender)Extends the loan and shares responsibility under the applicable scheme.regional-bank-consolidation-pattern / shinkin / credit-cooperative pages as relevant
Local credit guarantee corporation (51)Guarantees eligible SME obligations; handles subrogation / recovery.This system + local CGC pages where strategic (e.g., hokkaido-credit-guarantee-corp)
全国信用保証協会連合会 (JFG)Coordinates the 51 CGCs; administers responsibility-sharing system financial flows.national-federation-credit-guarantee-corporations
信用保険 (credit insurance) — JFCReinsures CGC guarantees; absorbs residual loss after CGC subrogation.jfc
METI / SME Agency (中小企業庁)Policy supervisor; sets program design, eligibility, crisis-mode authorization.INDEX
都道府県 / 市町村Local government — co-funds local programs, designates local-emergency events, provides subsidies.Local government routes

The system is therefore a vertical public-credit pipeline: borrower → lender → local CGC (first loss) → JFG coordination → JFC credit insurance (reinsurance) → METI policy backstop.

2. 機関概要 — local Credit Guarantee Corporations

項目内容
法令信用保証協会法 (1953)
法的形態特別法上の認可法人 (special-law authorized entities; public-credit institution)
数51 (47都道府県 + 4市 — 横浜市・川崎市・名古屋市・岐阜市)
所管経済産業省 (METI) / 中小企業庁 (SME Agency) / 都道府県
共通 ANCHOR全国信用保証協会連合会 (JFG)
再保険JFC 信用保険業務

3. 主要保証商品 (system-level menu)

  • 一般保証 — standard SME bank-loan guarantee under the 責任共有制度 (responsibility-sharing system; typically 80% guarantee / 20% lender retention for ordinary programs).
  • マル経保証 — small-business management improvement loan guarantee (商工会・商工会議所推薦案件).
  • 創業関連保証 — startup / new-business guarantee.
  • 事業承継特別保証 — business-succession guarantee.
  • 経営革新等支援保証 — management-innovation / business-transformation guarantee.
  • 借換保証 — refinancing / consolidation guarantee.
  • 流動資産担保融資保証 (ABL) — accounts-receivable / inventory-collateralized guarantee.
  • セーフティネット保証 (1号〜8号) — industry-distress designated-event guarantees with enhanced terms. (See §5.)
  • 危機関連保証 — national-emergency framework; up to 100% guarantee in declared crisis.
  • 災害関係保証 — disaster-recovery guarantee.
  • 新型コロナウイルス感染症対応 ZeroZero 融資 — COVID-era 実質無利子・無担保 special guarantee (2020-05 ramp; closed to new origination 2021-03; servicing / unwind ongoing through 2026+). (See §6.)

4. Guarantee ratio mechanics (責任共有制度)

The 責任共有制度 (responsibility-sharing system) — introduced 2007-10 — leaves a defined share of risk with the lending financial institution rather than 100% guarantee:

  • Standard (一般保証, 通常): CGC guarantees 80% of the loan; lender retains 20% residual risk (or pari-passu loss-sharing variant). This is the post-2007 default.
  • Full guarantee (100%) exceptions: certain policy programs (セーフティネット 1号・2号・3号, 危機関連保証, 創業 with conditions, マル経 with conditions, ZeroZero in crisis design) retain 100% guarantee with no lender retention.
  • Pari-passu loss-sharing variant: under the responsibility-sharing system, lenders can choose either (a) 80% guarantee structure or (b) loss-sharing structure where CGC and lender share losses pari-passu under a defined formula.

The 2007 introduction of 責任共有 was a deliberate policy shift to restore lender screening discipline after concerns about moral hazard in the pre-2007 100%-guarantee regime.

5. Safety-Net Guarantee programs (セーフティネット保証)

The セーフティネット保証 framework has 8 numbered designations, each covering a different distress scenario, and provides enhanced terms (often 100% guarantee + separate quota outside the borrower’s normal guarantee cap):

  • 1号 — large-enterprise restructuring impact (deemed event from METI based on a large-firm collapse / restructuring affecting downstream SMEs).
  • 2号 — large-enterprise operational shock (e.g., factory closure with supply-chain impact).
  • 3号 — bank failure / financial-institution liquidation impact on borrower SMEs.
  • 4号 — natural disaster / wide-area emergency (frequently activated for typhoons, earthquakes, floods).
  • 5号 — industry-wide structural distress; specific industries designated quarterly by METI based on macro / financial conditions. (Heavily used in inflation / pandemic / energy-shock periods.)
  • 6号 — failure of a financial institution (specific scope from 3号).
  • 7号 — large-enterprise restructuring with cooperative-finance impact.
  • 8号 — RCC (Resolution and Collection Corporation) demand impact.

Note 危機関連保証 (separate from セーフティネット) is the broader national-emergency framework with 100% guarantee, activated only on rare nationwide-crisis designation (COVID-19, 2008 GFC equivalent thresholds, etc.).

6. ZeroZero loan unwind status (2020 → 2026)

The ZeroZero loan (実質無利子・無担保融資) program was the central crisis-finance response to COVID-19:

PhasePeriodStatus
Origination ramp2020-03 → 2020-07METI launches private-sector ZeroZero via the credit guarantee system in 2020-05; rapid uptake reaching trillions of yen in months. JFC operates a parallel ZeroZero program directly.
Sustained origination2020-08 → 2021-03Continued large-scale guarantee origination via 51 CGCs nationwide.
Origination close2021-03 → 2022Private-sector ZeroZero closed to new applications (with limited extensions for narrow categories). JFC ZeroZero closed similarly through 2022.
Grace period2020 origination + 3y graceBorrowers typically had a principal-grace period (commonly up to 5 years for principal, with interest subsidy during initial period). The bulk of 2020-vintage loans entered repayment-start through 2023–2024.
Subrogation wave2023–2026As repayment-start triggers, subrogation (代位弁済) by CGCs ramps. Multiple business-trade-press reports show a clear uptick in 代位弁済 volume nationwide from late-2023 onward.
Post-COVID exit framework2022–2025METI / SME Agency coordinated with JFG for unified guidance on workout / refinancing of ZeroZero borrowers (借換保証 / 経営改善 product offers; “事業者ごとの粘り強い支援” framing).
Continued tail2026+Subrogation tail extends as remaining 2020-vintage loans complete repayment; bankruptcy statistics show ZeroZero-related bankruptcies as a tracked sub-category through 2024–2026.

The ZeroZero unwind is the defining recent stress event for the credit guarantee system and is visible in CGC subrogation statistics nationwide. Local-level coverage of the unwind appears in Hokkaido CGC and other local pages where strategic.

7. Funding source

Each local CGC is capitalized through a mix of:

  • National (国) contribution — METI / SME Agency capital and subsidy.
  • Prefectural / city (都道府県・市) contribution — local government capital; reflects local SME-policy priority.
  • Lender contribution (金融機関拠出) — partner banks / shinkin / credit cooperatives contribute capital to their local CGC.
  • Guarantee fee income (保証料) — annual rate on guaranteed principal, typically in low single-digit-percent range (with policy-program subsidies).
  • Federation pooled fund — JFG-administered reserves backing system-level coordination.
  • JFC credit insurance — reinsurance reimbursement on subrogation events through the Jfc account.

The public-credit risk-bearing waterfall is: borrower recovery → CGC reserves → JFC reinsurance → national fiscal backstop.

8. Default / subrogation flow

  1. Borrower defaults on guaranteed loan.
  2. Lender claims under the guarantee; CGC pays 代位弁済 (subrogation) to the lender for the guaranteed portion (typically 80% under 責任共有; 100% under crisis schemes).
  3. CGC pursues 求償 (recovery) against the borrower / collateral / personal guarantor.
  4. CGC files insurance claim with JFC under the credit-insurance contract; JFC pays insurance proceeds to the CGC.
  5. Residual loss (after recovery + JFC insurance) is absorbed by CGC reserves; if reserve depletion threatens, federation / national capital injection backstops.

Recovery rates vary by region, sector, and collateral type — urban CGCs (Tokyo, Osaka) typically have higher recovery rates than rural CGCs (Hokkaido, Tōhoku, Kyūshū rural) because of thicker secondary markets for commercial real estate and equipment.

9. Year evolution

YearEvent
1937東京信用保証協会 — first credit guarantee corporation established.
1953信用保証協会法 enacted; nationwide CGC framework.
1958中小企業信用保険公庫 established (later integrated into JFC).
2007-10責任共有制度 introduced — moved from 100% guarantee to 80% / 20% lender retention as default.
2008–2009GFC emergency response — セーフティネット 5号 widely activated; 緊急保証 program (近未来 100% framework).
2011Tōhoku earthquake — 災害関係保証 + 4号 widely activated.
2020-05ZeroZero (実質無利子・無担保) private-sector program launched through CGC system.
2021-03ZeroZero private-sector origination closed (with limited extensions).
2023+ZeroZero subrogation wave ramps as 2020-vintage grace periods end.
2024–2025Workout / 借換 product mix expansion; “粘り強い支援” framing.
2025Continued unwind; bankruptcy statistics show ZeroZero-related sub-category tail.

10. Boundary cases

  • System vs federation — this page explains the mechanism; national-federation-credit-guarantee-corporations explains the national coordinating body.
  • Guarantee vs loan — the CGC guarantees credit; the loan is made by a financial institution. The CGC is not the lender.
  • System vs single CGC — this page covers the system; local CGC pages cover specific prefectural / city corporations.
  • SME vs agriculture / fisheries — agriculture uses agriculture-credit-guarantee-system; fisheries uses fisheries-credit-guarantee-system.
  • CGC vs JFC direct lending — JFC also lends directly to SMEs; the CGC system is a guarantee-on-private-lending mechanism rather than a direct-lending program.

Sources