Home Banking & Finance Gov’t to guarantee P10 billion in MSME loans of six banks
Gov’t to guarantee P10 billion in MSME loans of six banks
STATE-RUN Philippine Guarantee Corp. (Philguarantee) has agreed to back loans of six banks worth P10.2 billion for micro, small and medium-sized enterprises (MSMEs).
Philguarantee said in a statement on Tuesday that it signed separate agreements with six banks to provide partial guarantee cover for MSME loans in case these are not paid back.
The banks are Bank of the Philippine Islands; UnionBank of the Philippines, Inc.; Malayan Bank Savings and Mortgage Bank, Inc.; BPI Direct BanKo, Inc.; New Rural Bank of San Leonardo, Inc.; and Bangko Kabayan, Inc.
The signing ceremony was held on Aug. 5 via a video conference, led by key officials from the banks, Philguarantee President and CEO Alberto E. Pascual and National Treasurer Rosalia V. De Leon, who also serves as the agency’s board alternate chairperson.
The agency approved P37.5 billion in credit guarantees in the first half for 22 accredited banks as part of the government’s program to help MSMEs have more access to credit amid the ongoing coronavirus pandemic.
“Philguarantee is processing accreditation of more banks to have broader channels of credit support to MSMEs, which would ensure a nationwide reach,” it said.
Philguarantee extended P5.5 billion in credit guarantees in the first quarter to 35 lending institutions in the agriculture sector, which could benefit more than 31,000 workers in the sector.
The corporation has so far approved a total of P159 billion in guarantee lines for 77 banks to support the housing sector, with more than 109,000 borrowers benefitting from the facility.
The government has set aside P120 billion for the credit guarantee program that will help small businesses gain access to loans for working capital.
The agency targets to provide 50% guarantee cover to at least 12,000 MSMEs affected by the ongoing coronavirus pandemic.
Eligible lenders include universal, commercial, thrift and rural banks as well as other financial institutions supervised by the central bank. — BML