MANILA, Philippines - The Association of Filipino Franchisers Inc. (AFFI) is seeking greater access to financing from banks for small and medium enterprises (SMEs) to allow them to expand and compete overseas through franchising amid the upcoming Association of Southeast Asian Nations (ASEAN) integration.
As the ASEAN integration is set to take place by December next year, AFFI chairman Armando Bartolome stressed the need for the country’s banks to provide greater access to financing to SMEs to allow them to expand in other countries in the region and take advantage of opportunities.
“SMEs with franchise capability can be a very good source not only of employment but also of overseas earnings for the country. We in AFFI, who are in the frontline of promoting Filipino brands, call on the banking industry to support us in actively moving Philippine franchising to ASEAN markets,†he said.
AFFI president Victor Fernando said providing a special loan rate for SMEs, particularly those going into franchising, would be a big help.
“AFFI calls on all Philippine banks to help support Filipino SMEs, specially Filipino brands with the potential to expand in ASEAN through professional franchising. The best support the banking system can give us is a special, extremely friendly SME business loan rate. Supporting Filipino SMEs is supporting economic development and job creation,†he said.
The ASEAN seeks to establish an economic community by December 2015, which would allow free flow of goods, services, skilled labor, investments and capital within the region.
The upcoming regional integration is expected to provide opportunities for the big corporations as well as SMEs.
To take advantage of opportunities, SMEs would have to improve their competitiveness which would require greater access to capital.
Access to financing has been a challenge for SMEs as lending to them is considered risky by banks.
The AFFI, which was organized in 1997, is the country’s prime trade organization committed to promoting responsible MSME businesses through franchising. It groups Filipino corporate presidents, chief executive officers, and businessmen who recognize the competitive potential of the local franchising industry in the global market.
The AFFI is promoting franchising as this is seen to help propel the growth of businesses, particularly SMEs.
SMEs are seen to play a vital role in the economy as they account for more than 90 percent of total registered businesses in the Philippines and provide employment.