The loan guarantee program of the government has benefitted over 12,000 micro, small and medium enterprises (MSMEs) affected by coronavirus disease 2019 pandemic.
According to a Department of Finance (DOF ) statement on Wednesday where it quoted Philippine Guarantee Corp. (PhilGuarantee) President and Chief Executive Officer Alberto Pascual in his report to Finance Secretary Carlos Dominguez 3rd.
In the report, Pascual said beneficiaries of PhilGuarantee’s MSME Credit Guarantee Program (MCGP) rose by 312 percent to 12,122 enterprises as of the end of March this year from 2,948 that were reported to have availed of the program as of December 2020.
He said the rise can the attributed to implementation of improved processing and evaluation parameters of the program starting this year.
The DOF noted the MGCP grants a 50-percent guarantee for working capital loans and a guarantee of up to 80 percent of the amount for term loans of up to seven years for capital expenditures.
The average loan size under the program is less than P1 million, with the minimum loan amount set at P100,000, which can be availed mostly by micro businesses borrowing from thrift banks and rural banks.
Pascual also reported that the total guaranteed loans under the program surged by 612 percent to P1.47 billion as of end-March this year from the P207 million in December.
He added the majority of the MSMEs covered were from the wholesale and retail sector, which accounted for 67.26 percent of the total, or P503.5 million with 9,113 MSMEs assisted.
The second biggest group with guarantee coverage was the manufacturing sector, which accounted for 7.77 percent or P58.17 million with 1,048 assisted MSMEs.
The agriculture sector was the third biggest sector that has benefited from the MGCP, with 158 MSMEs assisted through guarantees amounting to P33.91 million, which is 4.53 percent of the loans covered so far under this program.
In the severely affected hotel and restaurant sector, Pascual said that 573 MSMEs were assisted with guaranteed loans amounting to P28.45 million, while the personal services sector accounted for guarantees amounting to P31.82 million.