MANILA, Philippines - Total loans approved by banks to micro, small and medium enterprises (MSMEs) under a credit enhancement scheme breached the P2-billion level seven years after it was launched, the Bangko Sentral ng Pilipinas (BSP) reported over the weekend.
The BSP said the total accumulated loans approved by banks under the Credit Surety Fund (CSF) program has reached P2.03 billion as of end September.
The central bank said the program has benefitted 14,661 MSMEs nationwide.
“These figures continue to grow as the program penetrates the grass roots,” the BSP said.
The BSP initiated the CSF Program in August 2008 as a credit innovation designed to improve that cannot access bank credit due to lack of acceptable collaterals and credit information.
The CSF, through the issuance of a surety agreement, allows cooperatives and businessmen with viable business plans but limited capital to obtain loans from banks even in the absence of hard collaterals.
Now on its seventh year, the CSF program has been established in 30 provinces and 14 cities nationwide.
BSP Monetary Board member Felipe Medalla and Cabanatuan City Mayor Julius Cesar Vergara are expected to sign a memorandum of agreement today for the establishment of the 45th CSF in the country.
A total of nine cooperatives have joined the Cabanatuan City CSF by contributing an aggregate amount of P1.1 million while the city government has pledged an initial amount of P1.5 million.
With the establishment of the Cabanatuan City CSF, the stakeholders are optimistic that more MSMEs in need of financing would benefit from the program.
Meanwhile, Congress has unified the two approved versions of the CSF Bill through House Bill No. 6007 and Senate Bill No. 2909 at the Bicameral Conference Committee meeting last Oct. 14.
The final CSF bill would be submitted to President Aquino to make the CSF program more sustainable and institutionalized in more provinces and cities nationwide.