CCCI to strengthen links with financial institutions

CEBU, Philippines - The Cebu Chamber of Commerce and Industry aims to strengthen its partnership with financial institutions this year to help bridge the gap between industry players and the financing providers.

Despite the seemingly favorable interest rates and the easing of banks and other financial institutions to credit, still majority of the small and medium enterprises as well as the micro and cottage industries are still lamenting on lack of capitalization resources.

CCCI president Ma. Teresa B. Chan announced that one of the chamber's priority programs this year is to tighten its relationship with the financial institutions to finally come up with a resolution to the long overdue problem on financing requirements.

The chamber has already forged partnerships with various resource providers such as SB Corporation, Cebu Bankers Club, SGV, PhilExport, and Department of Trade and Industry's shared service facilities to ensure assistance to emerging industries and MSMEs.

Last year, CCCI signed a memorandum of agreement with SB Corporation, together with PhilExport-Cebu to recommend and enlist entrepreneurs or businesses that need financial assistance to grow their operations, amid the pressure of intense competition with the free-flow entry of products and services under the ASEAN Economic Community setup.

SB Corporation, a state-run financial institution, opened its direct lending facility even to businesses that cannot comply with the much stricter documentary requirements.

Despite this opening, Chan said micro and small businesses have continue to hold onto their fears of being rejected, and instead continue to bear the burden of paying high interest rates to informal lenders.

Chan added that a massive information campaign on the availability of the credit line offered even to non-members of the chamber is needed in order for businesses to be protected from loan sharks.

Aside from the P40 billion total allocation from SB Corporation's direct lending facility, private banking institutions are also opening their doors to corporate borrowers. In fact, most banks are now offering attractive loan packages specifically designed for SMEs.

Meanwhile, in a separate interview with Cebu Bankers Club president Gino Gonzalez, he said bankers in Cebu are going to reach out to SMEs to address the gap between financial institutions and the industry players in terms of accessing credit facilities.

Gonzalez said there is lost information in between that needs to be addressed and that SMEs should be educated further on the banks' requirements as well as its openness to lend.

He added that there is a need for SMEs to be updated and be more oriented on the banks' available credit products for the corporate market, specifically the SME community, which comprise over 90 percent of the businesses in the country.

Banks' primary requirement for a loan for instance are-- credit history, collateral, and financial standing. If one is into business, there is no reason why he cannot avail of credit facility from the banks. — (FREEMAN)