P100M loan facility readied for Marawi MSME

to replace 5-6 as the primary source of working capital

The Department of Trade and Industry (DTI) has earmarked P100 million microfinance loan facility for Marawi entrepreneurs to allow residents to start livelihood projects and spur economic activities in the war-ravaged town. Priority to receive loans are internally displaced persons (IDP) and soldiers in Marawi.

Trade Secretary Ramon Lopez said the credit window is part of the Duterte administration’s microfinance program under the Pondo sa Pagbabago at Pag-asenso (P3) to make inclusive growth happen in the communities.

More importantly, the P3 program is aimed at micro-, small- and medium-sized enterprises (MSME) as alternative source of capital and eliminate the prevalence of usurious or “5-6” loans that charge up to 20 percent monthly interest rate compared to 2.5 percent under the government loan program.

“President Duterte’s vision for P3 is for it to replace 5-6 as the primary source of working capital for micro entrepreneurs. To do this, we are working to rival their wide reach and accessibility,” said Lopez. He added the microfinance program provides loans to micro-entrepreneurs as low as P5,000.

He said the government plans to expand P3 and asked for an additional P5.3 billion on top of the P6 billion proposed allocation for next year.

Under the P3 Program, DTI allotted P50 million for IDP and another P50 million for wounded soldiers and families of soldiers killed during the siege. Of these, P5.28 million was extended to 364 IDPs and P11.96 million released to 167 soldiers and/or their families.

P3 loans are released a day after applications are approved and borrowers only need to submit to their nearest Negosyo Center a certification of their business. The certification need not be a business permit as Small Business Corporation (SBCorp), DTI’s microfinance arm, accepts certificates from market associations for market vendors.

DTI and SBCorp are working on further simplifying the requirements to address these concerns as some Marawi entrepreneurs cannot provide certification, since they could only set up stalls along the main roads after the siege.

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