Loan applications of MSMEs hit ₱2B

Loans filed by micro, small and medium enterprises (MSMEs) at the SB Corp., the micro financing arm of the government, has reached ₱2 billion, double the agency’s ₱1-billion fund allocation for lending to this sector affected by the COVID-19 crisis.

Trade and Industry Secretary Ramon M. Lopez said SB Corp. has already started this month, June, to release some approved loan applications. But since SB Corp. has only ₱1-billion fund, the DTI has made an arrangement with the Department of Finance to borrow more money from two government banks Land Bank of the Philippines (LBP) and Development Bank of the Philippines (DBP). SB Corp. has also an arrangement where it serves as a loan originator for the two banks.

Lopez stressed the need to help MSMEs restart their operations as they account for 70 percent of employment generation. SB Corp. offers a 6 percent annual interest rate for its borrowers.

To grow the MSME sector, Lopez reiterated his support of the move by the Department of Finance to require all online sellers to register with the Bureau of Internal Revenue to protect consumers. Lopez also stressed that registering with the government will also ensure growth of the enterprises. But for those just selling out of habit or intermittently selling online may no longer file.

The rule though, he stressed is for all businesses to register with the government regardless of size. Those that fall below the ₱250,000 in annual net sales are exempted from income tax payments. He cited the explosion of entrepreneurs over the years as there are now over 6 million unregistered micro enterprises from only 900,000 three years ago.

Lopez explained that one reason the country’s e-commerce has not really taken off despite the higher internet usage in the country is largely because of the issue of trust.

“Registration of your business with the government addresses the element of trust,” he stressed.

Cong. Wes Gatchalian, also a panelist at the “Kapihan sa Manila Bay” said that registering the online sellers is also one way of levelling the playing field because those being sold online are the same items sold in malls by vendors, who closed their stores during the lockdowns and are therefore unable to sell their products.

During a hearing, Gatchalian said that DTI reported of 9,000 complaints against online scammers for the January to May period alone while the Philippine National Police also reported of hundreds of illegal online transactions and arrests of perpetrators. (Bernie CahilesMagkilat)