COVID-hit MSMEs assured of credit assistance

Micro, small and medium enterprises (MSMEs), especially those struggling against the ill effects of the pandemic, are assured of the availability of credit assistance with recent measures taken by the Bangko Sentral ng Pilipinas (BSP_ and the Department of Trade and Industry (DTI).

In a recent statement, BSP announced that it will defer the implementation of the revised risk-based capital framework applicable to stand-alone thrift banks, rural banks and cooperative banks. This will enable these small banks to continue lending to their MSME- and rural community-based clients.

Originally set for December 31, 2021, the effectivity of the revised capital adequacy framework was moved to January, 2023 to provide these banks with enough time to meet the new requirements without disrupting their banking activities.

Earlier, last March 20, the Department of Trade and Industry’s Small Business Corporation (DTI SBC) opened a P1 bilion loan facility for the same business sector under its Pondo sa Pagbabago at Pagasenso, featuring a very low interest rate and an extended grace period.

Under the SBC loan program, micro enterprises with asset size of P3 million and below may borrow up to P500.000 at an interest rate of 0,5 . per cent a month. The loan provides a long grace period in loan repayment, or until the effects of COVID-19 on business operations have abated. Similar liberal loans are also available for small businesses with asset size of P10 million and below.

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