GOVERNMENT EARMARKS P28 BILLION FOR LENDING TO SMEs THIS YEAR
MANILA, January 23, 2005 (STAR) By Ted P. Torres - The government will set aside up to P28 billion in loans for small and medium enterprises (SMEs) this year, or P5 billion more than the targeted lending last year.
"That should be able to translate into half a million jobs, roughly the same as last year," said Zorayda Amelia C. Alonzo, chairperson and chief executive officer of Small Business Corp. (SB Corp.).
The loan package will be coursed through the SME Unified Lending for National Growth or Sulong program. Sulong is a unified effort by all government financial institutions (GFIs), which developed a simplified set of rules in providing credit access to SMEs in the country.
Some of the GFIs involved in the program are the Land Bank of the Philippines, the Development Bank of the Philippines, the Philippine Export and Import Credit and Guarantee Agency (PhilEXIM), and Quedancor.
By end-Nov. 2004, the Sulong program was able to extend almost P24 billion in loans to SMEs, resulting in more than 530,000 jobs. Regions 3, 4, 10 and the National Capital Region were the most benefited areas in terms of recipients.
Majority of the SMEs that availed of Sulong funding were in the manufacturing, domestic and export trading, and services.
SB Corp. alone was able to extend P3 billion to the SME market last year or P700 million more than the previous year’s P2.3 billion. This year, P3.6 billion has been set as the agency’s "achievable" target.
While lending to SMEs by the commercial banking system declined in 2002 and 2003, lending by GFIs reported considerable increases in the same period.
However, last year, most banks reported increased activity in SME lending as the corporate market engaged in new borrowings.
Reported by: Sol Jose Vanzi
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