SB Corp. requirements for shipping loan cited

THE Small Business Corp. (SB Corp.) has set the terms for its shipping loan facility and the qualifications for the exporters to be deemed an eligible borrower.

The attached agency of the Department of Trade and Industry (DTI) explained that a 1-year credit line will be granted to qualified exporters under the Covid-19 Assistance to Restart Enterprises (Cares program).

The threshold limit is 15 percent of sales based on the financial statements for 2019 and 2020—both of which should be filed with the Bureau of Internal Revenue.

“From there, we will compute 15 percent of the sales that will be the [credit] line that we can provide [exporters] but up to P5 million only is the limit,” SB Corp. Financing Sector Head Lourdes Rosario M. Baula said.

The loan availment shall be up to 20 percent of presented confirmed purchase orders or letter credits.

The borrowers will pay a service fee of 1 percent for a 30-day term loan, 2 percent for a 60-day term loan and 3 percent for a 90-day term loan.

The loan application process may take two to three working weeks, Baula said.

“But for the processing of loan release, usually it is not immediate,” she added. “[But] unless there is really an immediate need, we can process it within seven days.”

The small and medium-sized enterprises (SMES) with at least 1-year experience in export transactions may apply for the shipping loan, SB Corp. noted.

The eligible borrowers should have asset size of at least P3 million but not more than P100 million. The SMES should also have at least three consummated purchase orders or letter of credits.

Baula said that the loan facility was a response to the call of the exporters who may need additional financing to advance the freight cost when booking shipments.

“The increase in freight rates and cost of raw materials resulted in the increase of total production cost. With this scenario, the local exporters have to compromise their profit margin to meet export sales target and to keep their businesses afloat,” she said.

Earlier, the Philippine Exporters Confederation Inc. (Philexport) welcomed the opening of the lending window for the exporters amid surging freight costs.

“The SB loan would help financially tide exporters over, both small and medium establishments,” Philexport Chairman George T. Barcelon told the Businessmirror.