(Logo taken from sbgfc.org.ph)
MANILA – The Small Business (SB) Corp. will no longer impose interest on loans under the Covid-19 (coronavirus disease 2019) Assistance to Restart Enterprises (CARES) Program, its president and chief executive officer Ma. Luna Cacanando said.
In a radio interview with DZRH on Friday, Cacanando said SB Corp. would instead collect a 6-percent service charge that would be deducted upon the release of the loan.
The SB Corp., the financing arm of the Department of Trade and Industry (DTI), opened the loan application for micro and small enterprises under the CARES Program last Monday.
Under this microfinancing loan program, existing micro and small enterprises (MSEs) can tap the assistance to restart their businesses after they have been affected by the lockdown measures taken by the government to contain the Covid-19 outbreak.
Micro enterprises with asset size not exceeding PHP3 million can borrow between PHP10,000 and PHP200,000. Small enterprises with assets not exceeding PHP15 million can borrow up to PHP500,000.
The CARES Program loans initially have an interest rate of 0.5 percent per month.
“This is now zero-percent interest rate for 30 months but we will charge 6 percent as service fee to cover our expenses and to continue to roll this out,” Cacanando said in Filipino.
She added that SB Corp. would also give a six-month grace period before a micro and small business owner
can pay the loan.
SB Corp. will start to release loans next week, said Cacanando.
The DTI allocated PHP1 billion to roll out the CARES Program.
In the same radio interview, Trade Secretary Ramon Lopez said some 20,000 MSEs can benefit from the CARES Program if the average loan is PHP50,000.
Lopez also expressed confidence in rolling out this program through SB Corp. as the DTI’s financing arm has a repayment loan of 98 percent and has more reach among MSEs across the country.
“It is important that we help the MSEs so they can have the fund to continue their businesses and avoid laying off their workers,” he said, adding that since the PHP1-billion fund under the CARES Program can only reach 20,000 beneficiaries, the DTI is partnering with state-owned banks to get additional funds for the same program so the government can help more MSEs.
Lopez said the Congress is still preparing the Philippine Economic Stimulus Act (PESA) bill that would also provide zero-interest loans for MSEs and medium enterprises. (PNA)
