Gov’t program generates P132 B in loans to SMEs

The SME Unified Lending Opportunities for National Growth (Sulong) program has released a total of P132.2 billion in loans to 86,975 micro, small and medium enterprises (MSMES) since 2004.

The Sulong program is the government’s key initiative in developing the MSMEs through better access to financing. Government financial institutions (GFIs) under the program facilitated the lending process through more liberalized lending guidelines on loans to MSMEs nationwide.

In the last four years, the Land Bank of the Philippines (LBP) released a total of P69.54 billion, followed by the Development Bank of the Philippines (DBP) with P43.9 billion.

Other GFIs are SB Corp. which accounted for P13.48 billion; Quedan Rural Credit and Guarantee Corp. (Quedancor) with P3.15 billion; Philippine Export and Import Credit Agency (PhilExim) with P1.17 billion; Social Security System (SSS) with P726 million; and  the National Livelihood Support Fund (NLSF) with P263 million.

In the first semester of the year, SB Corp. alone released P1.8 billion in loans to the country’s MSMEs.

Total origination under its four major programs was 8.6 percent higher than its 2007 first semester accomplishment of P1.7 billion.

The Trade Department line agency’s best performing program is wholesale microfinance, which released a total P435.9 million to its microfinance conduits, almost doubling its origination of P240.4 million in the same period last year.

 “Our increasing microfinance loans is creating a more enabling environment for entrepreneurship by making loans readily available even in the countryside. With the enactment of the amended Magna Carta on MSMEs, which has included the microenterprises in SB Corp.’s coverage, the growing development of the microfinance sector will further be enhanced as SBC capacity has been strengthened by the same law,” Virgilio R. Angelo, SB Corp. chairman and chief executive officer, said.

The MSME retail lending program uptake increased eight percent from last year’s P224.8 million loans to P242.79 million in total loans this year.

“We expect our retail lending performance to improve further in the coming months given the implementation of its redesigned format. The loan facilities are now purpose based instead of industry based,” Angelo added.

“With a strengthened Magna Carta, we are now in a better position to intensify its lending activities through the expansion of its conduit-partners list.  We have also taken steps in redesigning our major products to make them more accessible and attractive to our clients,” he said.