LandBank extends loans to transport firms for PUV modernization program

MANILA, Philippines — State-run Land Bank of the Philippines recently signed loan agreements with two transport companies to help them get started with the shift to safer and more efficient jeepneys in compliance with the government’s PUV modernization program.

Transport companies, 1 Transport Equipment Aggregator and Management Inc. (1-TEAM), and PM Jeepney Drivers and Operators Services Inc. (PMJDOSI) were the first to avail of the LandBank’s loans under the Support Package for Environment-friendly and Efficiently-Driven PUVs or SPEED PUVs.

“We are very happy for these transport corporations’ trust in LandBank. We hope that this partnership will inspire more transport cooperatives and corporations to also allow LandBank to help them comply with the government’s modernization program,” LandBank president and chief executive officer Alex Buenaventura said.

Under the SPEED PUVs program, transport cooperatives and corporations can tap LandBank’s P1 billion credit facility to acquire new PUV units that are compliant with the Philippine National Standard specifications set by the Department of Trade and Industry for PUV Class 2 and Class 3.

LandBank will extend loans for up to 95 percent of the total acquisition cost of the units to be financed, while the remaining five percent will be covered by the borrower.

The loans are payable for up to seven years.

Eligible borrowers for the program include transport cooperatives or corporations with approved routes under the Land Transportation Franchising and Regulatory Board (LTFRB) Omnibus Franchising Guidelines have no pending case before LTFRB, with established and operating fleet management system; and with a suitable and managed garage.   

Individual jeepney driver-operators who wish to avail of the loan must be a member of an LTFRB-accredited transport cooperative or association, and must be between 18 and 58 years old on the date of loan availment.

“We thank LandBank for trusting us to be one of the first availers of the SPEED PUVs lending facility. We will take it as a challenge to do well so we could show our commuting public that it really is about time that we modernize our public utility vehicles,” PMJDOSI president Roberto Martin said.

“We are grateful to LandBank because they are now investing in the improvement of our transport system. The industry is composed of all stakeholders from incorporators, drivers, to mechanics. All of them have to make a living, but it has to be a decent living,” Yuri Sarmiento, president of 1-TEAM, added.

The PUV Modernization program seeks to modernize public utility vehicles across the country and provide a safer transport system for commu-ters while mitigating the effects of climate change.

It seeks to replace euro-2 engines with euro-4, which will increase the vehicle’s fuel efficiency and, therefore, cut down fuel cost. It is also seen to reduce particulate matters and CO2 emissions.

For 2018, the Department of Budget and Management (DBM) allocated P2.3 billion for loan facilities which drivers and operators can use to finance the shift to safer, more comfortable and more economic PUVs.

The DBM said the fund is lodged in the budgets of the LandBank and the Development Bank of the Philippines (DBP).