DTI starts releasing COVID loans for small businesses

The financing arm of the Department of Trade and Industry (DTI) has started the release of loans to help micro and small enterprises recover from the coronavirus disease 2019 (COVID-19) pandemic’s impact and expects to complete the disbursement of funds under the P1-billion lending program by the end of next month.

In a statement yesterday, DTI said the Small Business (SB) Corp., which administers the P1-billion COVID-19 Assistance to Restart Enterprises or CARES program, has released P22 million worth of loans to 286 beneficiaries as of July 8.

Of the total beneficiaries, 71 are from Cavite, Laguna, Batangas, Rizal and Quezon (Calabarzon), 52 from the National Capital Region, 46 from the Cordillera Administrative Region, 25 from the Bicol region, 22 from Central Visayas, 26 from Eastern Visayas, 18 from Mindoro, Marinduque, Romblon and Palawan (Mimaropa), 12 from Cagayan Valley, seven from Western Visayas, six from Ilocos and one from Caraga.

So far, SB Corp. has approved 2,419 accounts with a loan value amounting to P178.2 million for the CARES program.

“SB Corp. looks to complete the disbursement of the P1-billion fund earmarked for this program by the end of August,” DTI said.

CARES is being implemented to help micro and small enterprises bounce back from the impact of the COVID-19 outbreak on their operations.

Loans under the CARES program are available for micro and small enterprises operating for at least a year prior to March 16 and with an asset size not exceeding P15 million.

Micro enterprises with asset size of not more than P3 million may borrow P10,000 to P200,000, while small enterprises with asset size of not more than P15 million may avail themselves of loans worth up to P500,000.

Loans under the CARES program are pegged at zero interest and payable in 18 to 30 months.

Micro and small enterprises may use the borrowed funds to update loan amortizations for vehicle loans or other fixed asset loans of the business; inventory replacement for damaged perishable stocks and as working capital to restart the business.

Earlier, Trade Secretary Ramon Lopez said DTI is looking to use the P3.5-billion fund from the Pondo sa Pagbabago at Pag-asenso program or the agency’s regular lending program for micro and small enterprises to add to the P1 billion earmarked for the CARES given a huge amount of loan applications.

He said SB Corp. could also borrow from the state-run Land Bank of the Philippines and Development Bank of the Philippines to increase the funding for the CARES program.