Metro Manila (CNN Philippines, October 9) — The Small Business Corporation is close to releasing the proceeds of loan applications secured since June as it looks to assist micro enterprises to get back on their feet.
SB Corp. Vice President for Innovation & Advocacy Frank Lloyd Gonzaga said they are ready to extend more credit to ailing micro, small and medium enterprises (MSMEs) as he admitted that the loan process needs to be simplified further.
"We are already in the final stages of approving and finalizing the 15,000 applications for loan releases," Gonzaga told CNN Philippines' The Exchange.
"With the Bayanihan 2, we’re looking at further streamlining our process to make it more responsive. Despite the huge number of applications that we have already gotten, we believe that we will continuously receive more and more applications in the near future."
SB Corp., the financing arm of the Department of Trade and Industry, got scolded by lawmakers in June due to its slow approval process for loan requests.
The agency initially set up a 1-billion loan facility for affected MSMEs under the COVID-19 Assistance to Restart Enterprises program, but said it could take until July and August to use up the fund allotment despite strong demand for credit among struggling firms.
The Bayanihan to Recover as One Act which took effect in September set aside 39.472 billion as capital infusion to Philippine Guarantee Corp., Development Bank of the Philippines, and Land Bank of the Philippines to allow them to extend more loans to ailing companies, including small businesses.
The loanable amount under the program is between 10,000 and 200,000 for a micro enterprise with an asset size of not more than 3 million, while small enterprises with assets not more than 15 million may borrow a higher amount of up to 500,000.
Gonzaga said they are also opening an online portal to make it easier for MSMEs to submit an application while also cutting the processing time.
Loans through SB Corp.'s program carry zero interest but charge a 4 percent service fee deducted upfront. Borrowers can repay their debt between one and three years, which may include a grace period of between three and 12 months.
Gonzaga said they are making the process simpler, which will now focus on establishing the identity of the borrower, the fulfillment of underwriting guidelines, and the assessment of an MSME's capacity to settle the amount.
Source: https://cnnphilippines.com/business/2020/10/9/15000-SME-Loans-Small-Business-Corp.html?fbclid=IwAR0w2xp_jIlzrOfP_vQoACJm_mnxA_BQN-TaZYxHaGNOxHGf4-4qdedNQ4g