DTI wants additional P5 billion for MSMEs assistance

MANILA, Philippines — The Department of Trade and Industry (DTI) needs an additional P5 billion for its lending program for micro and small enterprises affected by the COVID-19 pandemic.

“An additional P5 billion will be good enough for now,” Trade Secretary Ramon Lopez said in an interview with dzBB yesterday.

He said this would be the ideal budget for the DTI’s COVID-19 Assistance to Restart Enterprises or CARES program.

The CARES program initially has made available P1 billion for lending to micro and small enterprises struggling with the impact of the COVID-19 crisis.

Last week, Lopez said DTI’s financing arm Small Business (SB) Corp., which administers the CARES program, has temporarily stopped accepting applications as the amount of loan requests for the facility already reached over P3 billion.

He said yesterday the CARES program would be open for applications again this week as the DTI finds new sources of funds.

“We are going to use other funds handled by SB Corp. and we are making arrangements, actually it’s almost done, arrangement of funds from Landbank and DBP (Development Bank of the Philippines),” he said.

He said P3.3 billion would be transferred from another lending program of SB Corp. to add to the current funding for the CARES program.

As the Bayanihan 2 bill or the extension of the Bayanihan to Heal As One Act, which would provide a stimulus package, is being tackled, DTI has also requested for additional funds from Congress for SB Corp.

While the SB Corp. has temporarily halted accepting applications for the CARES program, those already received are being processed.

Lopez said 22,000 applications have been received for the CARES program and so far, over 5,000 applications with total loans worth P350 million have been approved.

CARES is open to micro or small enterprises in operations for at least one year prior to March 16 of this year.

Through the program, micro enterprises with asset size not more than P3 million can avail of loans worth P10,000 to P200,000, while small enterprises with total assets not higher than P15 million can borrow up to P500,000.

Loans are pegged at zero interest rate, but there is a service fee of six percent for 18-month term loans and eight percent for 30-month term loans.