PhilGuarantee, Rizal Microbank partner for MSME financial support
MANILA, Philippines — The government’s state guarantee agency said it had signed an agreement with the Rizal Microbank, Inc., the thrift Bank of Rizal Commercial Banking Corporation, to provide financial guarantee support to micro, small and medium enterprises looking to secure loans.
Under the agreement, the Philippine Guarantee Corporation (PhilGuarantee) will provide a guarantee cover of a portion of the outstanding principal of the loan, along with a payment of claims up to the guaranteed obligation of the covered loan portfolio.
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“This partnership represents a significant step forward in ensuring the financial sustainability of the sectors we serve, primarily for the MSME sectors,” PhilGuarantee President and Chief Executive Officer Alberto Pascual said in a statement.
The agreement was signed last February 14 at the PhilGuarantee headquarters in Makati City.
For their part, Rizal Microbank, Inc. President Simplicio Dela Cruz said they hope their collaboration will help them extend the line or credit facility to their clients and borrowers, particularly in the countryside.
“We also hope that this will improve later as we manage our provisioning because of the guarantees you are providing us,” Dela Cruz said.
Bank lending posted its fastest growth in two years, crossing the P13-trillion mark in December according to figures released by the Bangko Sentral ng Pilipinas (BSP) earlier this month.
The outstanding loans of big banks, excluding their lending with each other, increased by 12.2 percent year-on-year to P13.14 trillion in the final month of 2024, beating the 11.1-percent growth in November.
Broken down, credit extended to companies for their production activities rose by 10.8 percent in the same month to P11.22 trillion, accounting for the bulk of outstanding loans held by big banks.
Meanwhile, consumer loans grew by 25 percent to P1.6 trillion, the best growth in seven months.
