ADB grants ASA PH Foundation $30-M credit facility

MICROFINANCE institution and non-government organization (MFINGO) ASA Philippines Foundation has announced that it has received the first tranche of the equivalent in Philippine Pesos of US$10 million from the Asian Development Bank (ADB) to extend loans to over 25,000 women micro-entrepreneurs from economically-lagging, environmentally-impacted and conflict-affected provinces in the Philippines, as small enterprises continue to suffer from the economic impact of the pandemic. The disbursement of loans began on Monday, June 22.

Both ASA and ADB have agreed that beneficiaries of the financing facility will be existing clients of the former, from the provinces in Leyte; Masbate; Samar; Zamboanga Sibugay; and the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), which will receive the bulk of the allocation for the loans. The women-entrepreneur clients must further be engaged in businesses considered essential during the pandemic, including sari- store operation; food production; and the sale of vegetables, fish, grain, and other basic household necessities

Though not part of its covenant with ADB, the board of ASA has nonetheless decided to offer part of this credit facility to be interest-free, to help their clients recover from business losses brought about by the coronavirus crisis. The interest-free finance loans are for a maximum amount of PhP4,000 per borrower, and may be settled in twenty equal payments within a 26-week (or 6-month) period; meanwhile, the business finance loans are for a maximum amount of PhP16,000 per borrower. A single borrower may be able to receive a combination of both interest-free finance and business finance loans.

Kamrul Tarafder, president and chief executive officer of ASA Philippines Foundation, revealed that they are “the first and only MFINGO to receive a non-guaranteed direct soft loan facility from ADB in Southeast Asia, in the Asian lender’s history.”