MANILA, Philippines - The Bangko Sentral ng Pilipinas said it hopes to increase loans extended through the Credit Surety Fund, a program that allows small businesses to borrow without collateral, to P1.5 billion by year-end.
Monetary Board member Alfredo C. Antonio said loans disbursed through various CSFs nationwide have reached P1.3 billion as of September, which benefited 10,442 micro, small, and medium enterprises (MSMEs).
“We hope to reach the P1.5-billion mark at the end of the year,” Antonio said during the launch of Marikina CSF yesterday.
The CSF, created by the central bank back in 2008, pools cash contributions from cooperatives, local government institutions, and other partner organizations. The funds will serve as security for loans extended by banks to member MSMEs.
To date, there have been 32 CSFs launched across the country — 15 in Luzon, seven in the Visayas, and 10 in Mindanao.
Antonio said there are more CSFs planned to be launched this year for the provincial government of Agusan del Norte, the city government of Butuan, the cities of San Jose and Munoz in Nueva Ecija, and the province of Nueva Viscaya.
The CSFs provide lower interest rates for borrower MSMEs as compared to the levels charged by private lending investors or loan sharks.
At the same time, the program gives free training in the areas of financial and risk management, entrepreneurship and business management, credit appraisal and monitoring.
Yesterday, the BSP and the Marikina City government signed a memorandum of agreement for the creation of the Marikina CSF.
The Marikina City Government pledged a P5-million contribution to the CSF, while 11 cooperatives in the city committed P2.9 million. Other participating partner institutions including the Development Bank of the Philippines, Land Bank of the Philippines, and the Industrial Guarantee and Loan Fund also gave contributions to the fund.