MANILA, Philippines - The Bangko Sentral ng Pilipinas (BSP) is further boosting its lending program for micro, small and medium enterprises (MSMEs) with the launch of a credit surety fund (CSF) in Gen. Santos City this week.
BSP Deputy Governor Diwa Guinigundo is expected to lead the signing of the memorandum of agreement with Gen. Santos Mayor Darlene Antonino-Custodio on May 15.
Initiated in August 2008, the CSF is a fund created through the pooling of cash contributions from participating cooperatives with an equivalent counterpart contribution from the local government unit and donations from partner institutions.
In lieu of acceptable collaterals, the fund would serve as guarantee for loans extended by banking institutions to MSMEs participating in the program.
The innovative credit enhancement program is aimed at meeting the financing requirements of enterprising cooperatives and capital-short businessmen who often experience difficulty in obtaining loans from banks due to lack of collaterals and credit track records.
Under the CSF program, a formal source of credit may now be accessed even in the absence of acceptable collaterals by way of a surety cover issued by the CSF in favor of the lending bank.
Now on its fourth year of implementation, the CSF program has been institutionalized in 17 provinces and five cities nationwide.
Dubbed as the Gen. Santos City Credit Surety Fund (GSCCSF), it would be the 22nd CSF established by the BSP nationwide.
“The establishment of the CSF in the tuna capital of the Philippines is expected to spur economic activities geared towards increased income, more job opportunities and a robust countryside development in General Santos City,” the BSP said.
The GSCCSF consists of contributions from well-managed and well-capitalized cooperatives within the city, and counterpart contributions of the city government of Gen. Santos and of donor institutions such as Development Bank of the Philippines, Land Bank of the Philippines and Industrial Guarantee and Loan Fund.
The City Economic Management and Development Office (CEMCDO) of Gen. Santos City assisted in gathering 15 cooperatives that contributed P2.5 million to the GSCCSF. The city government committed a counterpart contribution of P2.5 million.
Meanwhile, BSP Governor Amando Tetangco Jr. would lead the re-launch the Economic and Financial Learning Center (EFLC) in its Batac branch office in Ilocos Norte tomorrow.
Already in operation since 2008, the EFLC-Batac has expanded its scope and services by upgrading its facilities and linking with the EFLC network to ensure that all electronic resources in the EFLC in Manila are also available to the public in Batac.