Gov’t to set
aside another P1-B for Pondo sa Pagbabago at Pag-asenso micro-loan
December 7, 2017
MAKATI CITY – Micro
entrepreneurs throughout the country will get more aid to fund their
businesses as the National Government, through the Small Business
Corporation (SB Corp.), the micro-financing arm of the Department of
Trade and Industry (DTI), will set aside P1 billion for year 2018 to
continue the flagship program that will provide micro enterprises an
alternative source of financing that is easy to access and made
available at a reasonable cost.
“The President has vowed
to provide affordable micro-loans for micro entrepreneurs and we are
here to deliver this promise through the Pondo sa Pagbabago at
Pag-asenso (P3),” DTI-Regional Operations Group Undersecretary
Zenaida Maglaya said.
The Pondo sa Pagbabago at
Pag-asenso (P3) program is a P1 billion financing program intended
to give MSMEs better access to finance and to reduce their cost of
borrowing and battle loan sharks preying on micro entrepreneurs. The
fund will also give priority to the country’s 30 poorest provinces.
Initially, the P3 Program
was launched in Tacloban in Leyte on January 25, San Jose,
Occidental Mindoro on January 27, and Alabel, Sarangani last January
30 and was launched nationwide in April, with an initial funding of
P850.0 million, making available lower cost loans to Filipino micro
entrepreneurs who are engaged in small business such as sari-sari
stores and are vulnerable to usurious lenders in the absence of an
Maglaya explained that
through the P3, micro entrepreneurs can find relief from overly
expensive borrowings and afford cost-efficient and affordable form
of loan to add and expand their businesses.
“Through the P3, sectors
can find relief from overly expensive borrowings as they pursue
their livelihood activities,” Maglaya said.
As of November 24, 2017, a
total of 16,210 micro entrepreneurs have been aided by P3 with four
national micro finance institutions (MFIs) and 90 local conduits
assisting in delivering the micro-loans in the countryside while 45
MFIs are in the pipeline. A total of P485.41 million has been
released to partner conduits and P307.80 million released to
Rodrigo Duterte’s directive to replace the “5-6” money lending
system, the P3 is also seen to help stabilize supply and cost of
commodities in public markets, encourage small entrepreneurs to grow
their businesses, and offer employment and generate income for
The P1 billion fund of the
P3 program from the Office of the President will be coursed through
the SB Corp., which will accredit partner institutions such as
non-bank MFIs, cooperatives and associations to serve as conduit for
the P3 funds. With borrowers identified through these, collection of
repayments will be efficient.
“We’re very grateful that
this program has come into fruition, so we can help micro
entrepreneurs who are at the bottom of the pyramid and create an
entrepreneurial environment in the countryside that will also
generate jobs for Filipinos,” Maglaya said.
The primary beneficiaries
of the P3 Program are microenterprises and entrepreneurs that do not
have easy access to credit. These include market vendors, agri-businessmen
and members of cooperatives, and industry associations.
P3 will also make it easy
for borrowers since it will only require minimal documentation
requirement; easy to access with only one (1) day processing of
application; low cost interest at 2.5% per month; and easy payment
with collection on a weekly or daily basis, as necessary.
Under the P3 Program, a
micro enterprise can borrow between P5,000 up to P100,000 depending
on its business need and repayment capacity with no collateral
requirement. Interest rate and service fees, all in, do not exceed
2.5% monthly, which is a huge relief from the 20% monthly rate under
the 5-6 loan system.