Micro fund program now ready for implementation

The Department of Trade and Industry (DTI) and its microfinancing arm Small Business Corp. (SB Corp) have ironed out the guidelines for the implementation of the Pondo sa Pagbabago at Pag-asenso (P3) which aims to address the financing needs of micro entr

Funds for the P3 are expected to be released anytime soon.

P3 is the Duterte administration’s program to provide an affordable microfinancing for the country’s micro, small and medium enterprises (MSMEs).

The funding program provides micro enterprises an alternative source of financing that is easy to access and made available at a reasonable cost.

"Through this micro-financing program, those from the bottom of the pyramid will get to climb the ladder by expanding their businesses,” DTI Regional Operations Group Undersecretary Zenaida Maglaya said.

DTI Secretary Ramon Lopez is expected to introduce the national conduits and local micro-financing institutions for the P3 program.

The P3 is a P1-billion financing program intended to give MSMEs better access to finance and to reduce their cost of borrowing.

The fund will also give priority to the country’s 30 poorest provinces.

Following President Rodrigo Duterte’s directive to replace the “5-6” money lending system, the P3 is also seen to help stabilize supply and cost of commodities in public markets, encourage small entrepreneurs to grow their businesses, and offer employment and generate income for Filipinos.

The P1-billion fund of the P3 program from the Office of the President will be coursed through the SB Corp., which will accredit partner institutions such as non-bank microfinance institutions, cooperatives and associations to serve as conduit for the P3 funds.

With borrowers identified through these, collection of repayments will be efficient.

“MSMEs now have an option to avail of cheaper funds to expand their business,” Maglaya said.

The primary beneficiaries of the P3 Program are microenterprises and entrepreneurs that do not have easy access to credit.

These include market vendors, agri-businessmen and members of cooperatives, and industry associations.

P3 will also make it easy for borrowers since it will only require minimal documentation requirement; easy to access with only one (1) day processing of application; low cost interest at 2.5 percent per month; and easy payment with collection on a weekly or daily basis, as necessary.

Loan amounts to end-borrowers will range between P5,000 and P100,000, with no collateral requirement.