The Department of Trade and Industry (DTI) plans to further lower the interest rate of its financing program by partnering up with a subsidiary of PLDT Inc., which, in turn, will help micro entrepreneurs go digital.
Trade and Industry Secretary Ramon Lopez said in a recent interview that the government hoped to work with Voyager Innovations, tapping the latter’s digital expertise for a financing scheme aimed at giving micro, small and medium-sized enterprises (MSMEs) a better financing alternative as opposed to usurious lenders or loan sharks.
The program, called Pondo sa Pagbabago at Pag-asenso (P3), targets the 30 poorest provinces in the country, allowing MSMEs in those locations to have better access to finance and to reduce their cost of borrowing.
“We’ll use the Lendr platform,” he said, referring to end-to-end mobile platform meant for applying and processing any type of loan. Lendr is a product of FINQnologies Corp., the financial technology arm of Voyager Innovations.
Lopez said that doing so could reduce the interest cost for one whole year by three percentage points. Under the P3 program, MSMEs are given a 2.5 percent interest rate a month, making it 30 percent annually. With Lendr, this means the annual interest rate could go down to 27 percent.
This echoes Lito Villanueva, managing director of FINTQnologies, who cited the company’s partnership with the state-owned Land Bank of the Philippines.
“Before Lendr, their effective interest rate was 14.5 percent. Because of Lendr, we reduced it to 10.5 percent because of [less] administrative cost. There are no more people [for the administrative work]. So the interest rate would be reduced,” he said.
Voyager, for its part, launched on Dec. 12 a physical facility in its headquarters in Mandaluyong City called Digihub, which will be used by budding entrepreneurs as a space for consultation and mentoring.
For MSMEs that will sign up for the program, Voyager is offering a special Digital Plus package that includes its platforms and solutions. For P15,000, a business owner can have digital marketing tools in Facebook, SMS broadcasts and website landing page, among others.