More support for business survival
GOOD news came late last week to businesses in Luzon in terms of making a recovery for those manufacturing, distributing and selling “non- essential goods” in retail.
Transportation of goods, whether they are classified under the allowed cargo — food, medicine and essentials — or not, were approved by Trade Secretary Ramon Lopez. In a brief statement, Lopez said he would allow the movement of all cargo, so that there would be no “discretion and decisionmaking” at checkpoints that would result in “different treatments.” This memo ensuring movement of all types of cargo to go unhampered has given businesses a silver lining amid these trying times brought by the coronavirus diseases 2018 (Covid-19) pandemic.
For businesses directly affected by the Department of Trade and Industry ( DTI) memorandum, as well as businesses that are highly leveraged at the moment, here’s a roundup of important memos that could strengthen your business’ continuity during these trying times.
Business sustainability for MSMEs
It’s now Day 12 of the enhanced community quarantine (ECQ). Since then, we have expressed worried about the debilitating health of our frontliners, the rapid spread of the contagion, the transfer of municipal to national “powers,” and the state of our economy. As the ECQ only initially allowed those in the food, medicines and “essentials” industries to operate in Metro Manila, we are worried even for the micro, small and medium enterprises (MSMEs) that are the lifeblood of our country.
Nonetheless, as the Philippine Association of Meat Processors Inc. warned about the possibility of a severe shortage of meat products due to logistical bottlenecks in checkpoints that caused their facilities’ inability to receive needed raw and packaging materials, the DTI was quick to issue a memorandum circular (MC).
MC No. 20-08 dated Mar. 20, 2020 covers all enterprises that engage in the manufacture of food and essential goods such as medicines, soap, personal protective equipment, among others. It likewise includes the distribution and logistics to support manufacturing activities, including cargo handling, warehousing, trucking and port operations.
Retail establishments such as supermarkets, groceries, hypermarkets, convenience stores, and pharmacies and drug stores; and export and business process outsourcing ( BPO) companies are likewise included in the said issuance.
Apart from the unhampered movement of all cargoes, the MC lists that cargo would still be subject to random inspection, but movement shall not be delayed, upon presentation of the cargo manifest of delivery receipt that indicates the destination, nature and quantity of the loaded goods.
More cushion for businesses and the local economy
Each day, businesses like small coffee shops or laundromats located near schools are forced to close due to the choke in demand and supply brought upon by the ECQ. Suspended businesses ( both in the nonessential and essential goods industries) that have closed indefinitely are highly significant in their rising numbers; add to that the Department of Health’s time estimate that the Covid-19 curve will not flatten anytime soon and the result is a lethal combination that can cause an economic recession.
In spite of this, the business community has come together. Apart from the freeze in rent given by SM, Robinsons and Ayala Malls to their tenants, utilities payments were deferred as well as the filing and payment of the value-added tax and percentage taxes from March 20 to April 20, 2020 as stated in a Bureau of Internal Revenue MC. Additionally, the Securities and Exchange Commission ( SEC), through its Corporate Governance and Finance Department, issued a notice just this week to call for financing firms to support small businesses amid the Covid- 19 pandemic.
The notice states that the SEC “strongly encourages all financing companies (FC) and lending companies ( LC) to adopt measures that will help ease their borrowers’ financial burden. FCs and LCs may implement measures such as, but not limited to the following: lowering of interest rates; waiver or reduction of penalties, charges and other fees; loan term extension; suspension of collection; payment holiday; and debt consolidation. FCs and LCs may also develop and implement their own programs or schemes that will provide financial relief to their borrowers.”
In response to this, First Circle has tried to help ease its customers’ financial burden by offering a 30-day payment holiday. We firmly stand by our mission to provide our customers with fast, fair, and flexible financial partnership especially during this critical time. Since week one, we provided our customers with a payment holiday for those with existing loan plans that have repayment due dates within March 17 to April 17 this year. Late fees and additional interest for the 30-day extension would be waived during the said period as well.
We continue to be fully operational for those in need of financing for working capital gaps. We have fully transitioned to a remote working setup to ensure that we are able to continuously finance our customers’ projects, working capital requirements and other daily expenses. All transactions can still be done online at the convenience and safety of their homes.
Business financing aside — while the state of our economy remains uncertain as we remain in ECQ until Apr. 12, 2020, let’s continue to look up for small steps in terms of provisions that aim for business continuity and a return to a balanced economy.
Lee-Anne Tobias is the senior communications associate of First Circle Growth Finance Corp. She has 10years of experience in digital media, business communications, corporate social responsibility, and qualitative research in the energy and market research industries. You may email her at lee-anne. tobias@firstcircle.com. To know more about First Circle and its financing services, please visit www.firstcircle.ph.