DTI set to roll out P18-B ‘pondo para sa pagbabago’
The Department of Trade and Industry (DTI) plans to lend as much as P18 billion to micro, small and medium sized enterprises (MSMEs), to help them expand.
Trade Secretary Ramon Lopez said Monday on the sidelines of the Manufacturing Summit 2016 that the fund would be called “Pondo para sa Pagbabago at Pag-asenso” or P3.
“We will ensure that these funds will benefit the small businessmen, even those that sell in the wet markets and sidewalks. We will conceptualize a program for the microfinance institutions to implement,” Lopez said.
The target, he said, was to make the first P1 billion available by January next year.
The budget will come from the national government and coursed through the DTI’s financing arm, Small Business Corp. (SB Corp.).
The loans will then be channeled through at least six microfinance institutions (MFIs) that the DTI will identify.
Borrowers will be charged market rates, but below the 20 percent usually collected by loan sharks.
“SB Corp. may hold the wholesale fund, which will be channeled through MFIs for relending. We are looking at loans that start from as low as P5,000 to as high as P200,000,” he added.
The DTI prioritized the lending program as the lack of access to affordable credit was deemed one of the major factors holding back the growth of MSMEs.
If this first billion takes off without a hitch, Lopez said the DTI would then request for the balance of the P18 billion in the succeeding budget seasons.
The plan is to roll out P1 billion per region for microfinancing, the trade chief added.
