The Department of Trade and Industry (DTI) through its financing arm the Small Business Corporation (SBCorp) has approved, as of 9 February 2021, a total of 21,695 loan applications under the Bayanihan COVID-19 Assistance to Restart Enterprises (CARES) program to provide micro, small, and medium enterprises (MSME) with urgent relief needed to restart their businesses amid the pandemic.
“Our efforts to provide relief and assistance to MSMEs through the CARES program are further strengthened, especially as we work towards the sustainable and inclusive recovery of our nation. Over 20,000 MSMEs have already benefitted from this loan portfolio, which has helped businesses survive from permanent closure, recover from the effects of the pandemic, save or even create more jobs, and provide income to millions of Filipinos and their families,” said Trade Secretary Ramon Lopez.
“We have streamlined the application process and made it online to ensure that more businesses are able to avail of this service. SBCorp completes its evaluation of loan requests within 7 working days, even faster if the documents are complete. Submission of documents such as BIR tax return can fastrack approval,” he added.
“There is currently no backlog on its loan evaluation work contrary to what other reports say. We are even promoting the program to more MSMEs applicants,” Sec. Lopez clarified.
The trade chief emphasized that MSMEs are a key pillar of the country’s economy, which contribute 35.7% to GDP, employ 62.5% of the labor force, and constitute 99.5% of all business establishments in the country. Based on the nationwide survey of over 3,000 MSMEs conducted by DTI, around 38% were forced to close down during the height of lockdown in April to June last year, and this number went down to 5% towards yearend 2020, as more sectors were gradually reopening.
Under the Republic Act No. 11494 or the “Bayanihan to Recover as One Act” (BAYANIHAN 2), financial support amounting to Php 10 billion has been allotted to the CARES program to help mitigate the adverse impact of the pandemic on MSMEs.
SBCorp President and CEO Ma. Luna E. Cacanando reported, “To date in the implementation of the Bayanihan CARES Program, SBCorp has already approved 21,659 loan applications. These loan applications have an equivalent approved loan amount of P2.35B.”
Loans from the Bayanihan CARES Program are interest-free, collateral-free, and are available to MSMEs, cooperatives, hospitals, and tourism businesses that have been in operation for at least one year. Repatriated or returning OFWs who wish to engage in start-up business may also apply for a loan under the program after some trainings.
The Trade Secretary emphasized that documentation has been simplified, doing away with traditional requirements that may be difficult to source with the limitations of the pandemic. Loan terms can be up to four years, including a grace period of up to 12 months, giving MSMEs enough breathing space for the business to recover, and time to pivot and innovate their business models.
To comply with social distancing measures and to reduce physical contact, SBCorp has adopted a completely online loan application and evaluation process, except for occasional phone verifications. The loan releasing process has likewise shifted online, unless physical signing is preferred and requested by the approved loan applicant.
Secretary Lopez reiterated his call to all MSMEs who wish to restart or to strengthen their business operations to avail of the Bayanihan CARES lending fund.
“We encourage all MSMEs across the country in all regions to consider taking the step in reopening or reconfiguring your respective businesses. The features of the Bayanihan CARES loan are intended to allow entrepreneurs to restart their businesses with ample elbow room. There is no need to worry about loan repayments for one year. There is also no need to worry about escalating financing costs,” Sec. Lopez said.
Interested business owners may submit their loan requests through www.BayanihanCARES.ph. Applicants may also contact the CARES Hotline at 8651-3333, and at 1-800-10-651-3333 (nationwide toll-free) for inquiries.
In addition, DTI, its provincial offices, and Negosyo Centers spread out across the country are also available to support small entrepreneurs in the regions. Business owners may head to any of the offices or may opt to send their concerns through the available online portals.