The Department of Trade and Industry (DTI) had temporarily stopped since last month accepting loan applications from businesses that needed help to survive the health crisis after its P1-billion fund fell short of meeting demand.
Small Business Corp., a DTI-attached agency, has been tasked to release the fund under the COVID-19 Assistance to Restart Enterprises (CARES) program.
The program was first announced last March. However, SB Corp. had stopped accepting new applications since June 18, while hoping to reopen sometime in August if it could get extra funding.
In an earlier interview, Frank Lloyd Gonzaga, group head of planning and advocacy at SB Corp., explained that P1 billion was allotted for the CARES program not because it was enough to meet the demand for the loan, but because it was all SB Corp. had left.
Trade and Industry Secretary Ramon Lopez said in a radio interview earlier this week that the CARES loan was oversubscribed, with the thousands of applications needing P3.3 billion in loans.
“If we open it, maybe businesses would expect when we don’t have [enough] fund for now. This is just temporary because now what we are doing is making [an] arrangement for additional funds,” he said.
He reiterated that the DTI was in talks with Land Bank of the Philippines and Development Bank of the Philippines for funding. They were also hoping for the passage of a stimulus bill in Congress.
The average loan size asked by applicants across the country was P130,000, Gonzaga said.
Only micro and small businesses that have been operating for at least a year before the lockdown could avail themselves of the loan assistance, which carries zero interest and payable over 18 to 30 months.
Admittedly, P1 billion could only do so much, when out of more than a million registered enterprises, about 90 percent are considered small and micro businesses.
Despite insufficient funds for struggling entrepreneurs, the DTI-attached agency still launched this week a P100-million loan facility for repatriated Overseas Filipino Workers affected by the COVID-19 pandemic.—ROY STEPHEN C. CANIVEL