MICRO-sized, small-scale and medium-sized enterprises are expected to gain wider access to credit after the Land Bank of the Philippines (LandBank) launched a new lending program.
According to the state-run lender, the program called ‘Lifting MSMEs Lending,’ offers loan packages that can be used for working capital, expansion, equipment upgrades, renovations, digitalization, franchising, export and trade finance, and green or sustainable projects.
The loan program (‘LandBank’s Innovative Financing Thrust Towards Inclusive National Growth thru Micro, Small and Medium Enterprises’) is structured around three financing tiers to support enterprises at every stage, the lender explained in a statement.
Under the start-up loan, start-ups and microenterprises with less than one year of operation may borrow from P100,000 to P500,000, with free financial literacy training and minimal collateral requirements.
For micro-sized and small-scale firms with at least one year of operations, the Step-Up Loan offers financing from P500,000 up to P5 million, alongside training support, provision of point-of-sale (POS) terminals and eligibility for higher loan brackets.
Small-scale and medium-sized businesses with over three years in operation may tap the ‘level-up loan,’ which extends up to P50 million in funding, coupled with access to the LandBank corporate credit card.
Beyond direct lending, LandBank will also extend rediscounting lines to credit cooperatives, rural banks and microfinance institutions that serve MSMEs, covering as much as 85 percent of outstanding receivables to strengthen their lending capacity.
LandBank President and CEO Lynette V. Ortiz has recognized MSMEs as the ‘backbone of the Philippine economy,’ comprising 99.6 percent of total business establishments and employing 65 percent of the workforce.
‘Every loan extended to an MSME creates a ripple effect-sustaining jobs, uplifting families, and strengthening communities. Through the Lifting MSMEs Lending Program, LandBank is fueling this multiplier effect to accelerate inclusive and sustainable growth across the nation,’ Ortiz was quoted in the statement as saying.
Applications may be filed through the LandBank Business Loan Application Portal, a digital platform that allows borrowers to directly submit forms, upload documents and monitor application status.
LandBank booked a net income of P13.29 billion in the first quarter of this year, up by 11 percent year-on-year from P11.98 billion.
LandBank’s total assets increased by 5 percent to P3.426 trillion in the first quarter from P3.268 trillion in the same period last year, on the back of expansions in loan and investment portfolios.
The bank’s gross loan portfolio rose by 8 percent to P1.58 trillion, while its investments jumped by 14 percent to P1.50 trillion in the first quarter, driven by growth in both trading and non-trading portfolios.