DBP to assist co-ops, rural banks develop micro, SME sector

MANILA, Philippines - The Development Bank of the Philippines (DBP) is expanding its activities designed to assist cooperatives and rural banks in developing the micro, small and medium enterprises (MSME) sector.

This will be done through various development programs aside from wholesale lending, which offer competitive rates or lower than commercial levels..

DBP president and chief executive officer Reynaldo G. David said the needs of the MSME sector has become more sophisticated beyond wholesale borrowings.

“The DBP strives to keep up with the changing times in order to ensure its strong partnership not just with cooperative and rural banks but more so with the MSME sector,” David said.

DBP has made over P21 million in contributions to the Credit Surety Fund (CSF) program. The CSF pools resources of cooperatives, non-governmental organizations (NGOs), provincial and municipal cooperative development councils, with counterpart funding from local government units (LGUs), other public and private agencies and donors. It can also serve as a guarantee facility.

It has also been involved in training and “coaching” cooperatives and rural banks particularly in terms of capacity-building.

The Bangko Sentral ng Pilipinas-supported fund was designed to enhance the creditworthiness of small entrepreneurs and mitigate the credit risk of cooperatives and rural banks extending credit to the MSME sector.

The government financial institution is primarily mandated to be involved in wholesale lending and other strategic banking operations. Its retail banking activities is secondary to its developmental orientation.