SME lending reaches P170.3 billion

MANILA, Philippines - Lending to micro, small and mediun enterprises (MSMEs) has reached P170.3 billion in the past five years through the various government agencies, according to the Small Business Corp., the lead convenor for the SME Unified Lending Opportunities for National Growth (Sulong) program.

SB Corp. alone has extended total loans of P16.2 billion during the same period.

As of end-June 2009, the lending program has benefited 49,263 MSMEs, supporting about 2.5 million jobs.

“There are other government and private agencies and stakeholders called participating financial institutions or PFIs, as they expand the outreach of the program since their presence in the rural areas makes it easier for SMEs to access Sulong funds,” said SB Corp. president Benel P. Lagua, the Sulong finance committee chairman.

Since 2004, the Land Bank of the Philippines (LBP) has extended a total of P93 billion, followed by Development Bank of the Philippines (DBP) with P54.7 billion in loans.

The Quedan Rural Credit and Guarantee Corp. (Quedancor) released P3.3 billion, while the Philippine Export and Import Credit Agency (PhilExim) accounted for P1.5 billion.Government pension fund Social Security System (SSS) released P1.2 billion while the National Livelihood Support Fund (NLSF) managed to lend P294.5 million in retail and wholesale loans to SMEs.

SB Corp. in particular, has various lending programs designed for specific sectors.

It has the Rural Micro-Enterprise Promotion Program (RuMEPP), a seven-year rural microfinance program lending program for the country’s 19 poorest provinces with funding from the International Fund for Agricultural Development (IFAD).

RuMEPP complements the government’s programs for poverty alleviation by providing sound credit delivery matched with business development services.

It likewise has the MSME Retail Lending program, which has surpassed the half billion-peso mark. Its wholesale lending program, meanwhile, which is reportedly nearing the P3-billion mark, has more than a hundred PFIs, half of which are rural banks.

It is also partnering with official development assistance (ODA) agencies such as the Asian Development Bank (ADB), InWent, and German development-oriented financial institutions such as KfW and GTZ.