MANILA, Philippines — The government plans to extend the maximum amount of loans to tourism firms that will keep at least 90 percent of their labor force to encourage employers to retain their workers.
Tourism Congress of the Philippines president Jose Clemente III said the Small Business (SB) Corp., tasked to process the loans awarded to travel enterprises, is now looking into options on how to increase the utilization rate of its credit facility.
The SB Corp. is eyeing to approve a second round of loan applications for tourism firms that will retain 90 percent or more of their workers.
“SB Corp. will also look at employee retention as a criteria for approving applicants who need a second round of loans. That’s an indirect way to address the unemployment, as the amount can be used to retain tourism workers,” Clemente told The STAR.
Industry players in need of capital replenishment want to receive the highest possible loan that they can secure from a program instituted by Bayanihan 2. However, most of them obtained just half of the maximum allowable amount due to the criteria placed by SB Corp.
The Bayanihan 2 aligned P10 billion to fund recovery efforts for tourism, of which P6 billion was set aside for loans for micro, small and medium enterprises (MSMEs).
The program managed by SB Corp. awards zero interest, no collateral lending to MSMEs in the tourism sector, payable for up to four years.
Depending on the financial statement, medium enterprises can avail loans of not more than P1 million, while small and micro enterprises can apply for a maximum of P500,000 and P200,000, respectively.
According to Clemente, SB Corp. also looks to give borrowers five years to pay the loan, as the latest revert to lockdown forced tourism firms to close yet again. When the payment deadline of four years was decided, it assumed that travel would begin its recovery this year.
“We discussed with SB Corp. the possibility of extending the payment period for one year. How can the borrowers pay for their loans when they have yet to even resume business?” Clemente said.
Tourist destinations nationwide are operating on limited capacity in compliance with government regulations, including in Metro Manila where only premium hotels are permitted to take in leisure stays and just outdoor attractions are allowed to reopen their doors to visitors.
More than 4.8 million of the 5.7 million workers in tourism were displaced by the health crisis with no certainty as to when, or if, they can regain their livelihood.