MANILA, Philippines — The Asian Development Bank (ADB) has signed a $115-million loan agreement with Asialink Finance Corp. aimed at supporting small and medium enterprises (SMEs), particularly those owned by women in the Philippines.
In a statement yesterday, the multilateral lender said the agreement was signed by ADB director general for private sector operations Suzanne Gaboury and Asialink CEO Robert Jordan Jr. in Manila.
The financing package – $50 million loan from ADB, $50 million from HSBC and $15 million from Security Bank Corp. – is expected to expand Asialink’s working capital and support SMEs, especially those owned by women.
In particular, it will increase Asialink’s total loans to SMEs to around P13 billion from P8.8 billion, with more than half of the financing targeted for women-owned SMEs.
The project aims to nearly double Asialink’s female entrepreneur borrowers to at least 20,000, as well as launch solutions tailored to women business owners’ needs.
“Non-bank financial institutions play a key role in providing services to unbanked SMEs. This partnership between ADB and Asialink will enhance SMEs’ access to finance, especially for women entrepreneurs who face greater challenges in obtaining capital,” ADB vice president for market solutions Bhargav Dasgupta said.
ADB served as the mandated lead arranger, bookrunner and structuring bank, while HSBC acted as joint mandated arranger and bookrunner. Security Bank Capital Investment Corp. was the mandated lead arranger.
Access to financing is a challenge for SMEs in the Philippines, with the financing gap estimated by the Department of Trade and Industry at around P67 billion to P180 billion.
Recent surveys have also shown that half of SMEs owned by men transact using bank accounts, compared to just 24 percent for women-owned SMEs.
In terms of bank loans, 14 percent of SMEs run by men have received approval, compared to four percent for those owned by women.
Jordan sees the partnership with ADB as a milestone in Asialink’s mission to empower SMEs across the Philippines, especially those owned by women, which remain underrepresented in the financial sector.
“We are optimistic that with this collaboration, we can continue to expand our presence nationwide, introduce personalized loan products, digitize and innovate our loan processes and ultimately ensure that entrepreneurs have access to reliable financial solutions,” he said.
Established in 1997, Asialink has become one of the leading nonbank financial institutions in the Philippines, providing loans to SMEs using motor vehicles as collateral.
Earlier this year, Asialink received a P4-billion strategic investment from Creador V L.P., a fund managed by regional private equity investor Creador and backed by ADB.