Loan financing available for Covid-19-affected MSMEs

MICRO, small and medium enterprises (MSMEs) whose businesses are adversely affected by the spread of coronavirus disease 2019 (Covid-19) may avail of government loan financing that will help them stabilize or recover from their losses.

The Small Business Corporation, an agency under the Department of Trade and Industry (DTI), is setting up a P1-billion Enterprise Rehabilitation Financing facility under the Pondo sa Pagbabago at Pag-asenso (named Covid19 P3-ERF).

Micro and small enterprises with at least one year continuous operation prior to March 2020 and whose businesses suffered drastic reduction in sales during the ensuing epidemic can tap the ERF loan fund.

Micro enterprises with asset size of not more than P3 million may borrow P10,000 up to P200,000; and small enterprises with asset size of not more than P10 million may borrow a higher loan amount but will not exceed P500,000.

Interest rate shall be at 0.5 percent per month, and grace period on payments shall be given until such time that the economic crisis has abated.

Loan applications will be accepted after the enhanced community quarantine is lifted by the national government and/or respective local government units.

Apart from this financing facility, state-owned Development Bank of the Philippines (DBP) is also providing financing to businesses and local government units (LGUs) which may be affected by the quarantine.

DBP President and Chief

Executive Officer Emmanuel Herbosa said the Rehabilitation Support Program on Severe Events (DBP RESPONSE) aims to provide financing support for rehabilitation efforts of both public and private institutions which would be adversely affected by calamities, such as the Covid-19 health threat.

Private institutions eligible to avail of the program include enterprises, corporations, cooperatives, associations, schools, hospitals and financial institutions.

Loan amount is based on project requirement which is subject to validation.

Interested applicants may coordinate with any DBP Lending Center near their area to get further details on the mechanics of the loan program, or access the DBP website at www. dbp.ph. /