Image credits: Land Bank of the Philippines
HUNDREDS of borrowers composed mostly of micro, small and medium-scale enterprises (MSMEs) and co-operatives are benefitting from recent loan approvals amounting to P6.95 billion by Land Bank of the Philippines, the state-run financial intermediary said.
Of this amount, P5.28 billion has been released to 208 borrowers already as of end-January, LandBank said in a statement it issued over the weekend. These clients include 167 MSMEs, 34 co-operatives, four microfinance institutions (MFIs), and three large corporations.
Launched in April last year, the credit facility is expected to stimulate the recovery of these businesses deeply-affected with what Bangko Sentral ng Pilipinas Deputy Governor Diwa C. Guinigundo said was the poor governance of the pandemic.
The LandBank said the facility provides credit and loan restructuring under more flexible terms and conditions to MSMEs, MFIs and co-operatives. This after the bank recently expanded the coverage of the borrowing window to allow more clients to avail of the credit and loan restructuring assistance.
It now permits both the MSMEs and big corporates to borrow up to 85 percent of their emergency or permanent working capital, the LandBank said.
The interest rate is at 5 percent per annum for three years and will be subject to annual re-pricing after that period. The loan is payable up to 10 years with grace period of up to two years on the principal repayment.
The LandBank said it plans to expand this lending program to introduce new sub-credit facility for the benefit of the MSMEs, co-operatives and self-employed individuals.
The bank said qualified borrowers, under this initiative, may be able to borrow a minimum amount of P100,000 or up to 85 percent of their permanent working capital requirement. Loans will be offered with lower interest rate of 3 percent per annum and are payable up to three years.
“We are enhancing the lending program to cover a wider range of key industries that need greater access to credit,” LandBank President and CEO Cecilia C. Borromeo was quoted in the statement as saying. “LandBank is keeping in step with emerging requirements under the new normal in support of the country’s ongoing economic recovery.”
The LandBank said it is making the lending program available until 2022.
Last week, LandBank announced the approval of P62.32-billion worth of financing for 194 local government units across the country. Of this amount, P1.89 billion has been released already to 32 LGUs as of February 2, the LandBank said.
The fund is coursed through another credit facility that aims to extend necessary funding requirements of provincial, city and municipal LGUs that are under different levels of quarantine measures.
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