The array of small and medium-scale businesses that contribute up to 62.5 percent of employment and comprise 99.5 percent of all businesses in the Philippines were getting only 9.2 percent of loans and financing from the country’s major banks.
These figures prompted the Union Bank of the Philippines to ask its fellow financial institutions to recognize the key role medium and small scale enterprises (MSMEs) play in the Philippine economy and allocate more of their money to help these MSMEs thrive, at least.
To help MSMEs thrive, Unionbank is offering a digital platform, called UnionBank GlobalLInker, to allow entrepreneurs to promote their brands, products and services and get access to financial assistance and other solutions.
Maurese Soriano, UnionBank program manager, said the platform would help “address restraints on capital and other sources of funding” besetting MSMEs.
Pia Roman-Tayag, Bangko Sentral ng Pilipinas managing director, at a recent forum cited a World Bank report that showed some 81.2 percent of Philippine businesses rely on internal funds to finance expansion of keep themselves alive. Only 0.1 percent have access to bank financing, which was seen as a key ingredient of growth.
Tayag said smaller firms do not know where to turn to for financing while financing institutions have been limited in their assessments of small businesses because of their lack of credit history. (Editor: Tony Bergonia)