PlantersBank offers financial aid to micro-entrepreneurs

Micro-entrepreneurs could now avail of a decent financial assistance, with lower interest rates, as the Planters Development Bank (Plantersbank) enters into providing financial help to this sector.

After the Bangko Sentral Ng Pilipinas (BSP) approved the merger of PlantersBank and micro-finance affiliate Micro Enterprise Bank, in Davao City, PlantersBank chairman Jesus P. Tambunting said small business entrepreneurs such as market vendors, sari-sari store owners, side-walk vendors can soon avail of credit facilities through the micro-entrepreneurs desk that will be made available in every Plantersbank branch nationwide.

In an interview with Tambunting, he said the move of Plantersbank to enter and be aggressive into micro-finance following the merger, is to help the smaller businesses get away from loan sharks, and will be able to avail of financial services that offer lower interest rate.

Aside from offering its credit facility to retail market in the micro-business sector, Tambunting said the bank will also offer credit assistance to cooperatives, Non-Governmental Organizations (NGO), and other micro-lenders as wholesale loan facility for micro entrepreneurs.

Currently, Tambunting said it is still harder for the bank to convince the small business operators to borrow from the bank, as it is they are not used to it, most, if not all, are getting their financial loan requirement from under-ground lenders or locally known as 5/6.

He said the bank will be able to offer as much as P150,000 loan to a micro-entrepreneur to as low as P5,000 as "clean-loan" or without collateral. He said he is confident that the bank will not experience a hard time in terms of collection, as micro-finance collection rate is within 22 percent to 94 percent, which is a good indicator.

Tambunting was in Cebu recently to touch-base with Plantersbank's clients here, especially the Small and Medium Entrepreneurs (SMEs) mostly exporters.

"The SME sector is very robust and the demand for financing is high. Cebu remains one of the country's bright spots for SMEs," Tambunting said emphasizing that the bank will continue to expand its business in SME-oriented loans and solutions to the Cebu province.

Plantersbank's loan portfolio in Cebu for this year has reached to P700 million, a high jump from P125 million in 2002.

Plantersbank is one of the three banks in the word recognized by the Harvard Business School Conference on Global Poverty for pursuit of a strong "double bottomline"-the successful combination of profitability and social development objectives like job creation and poverty alleviation.

Tambunting added that with the bank's merger of the Micro Enterprise Bank, Plantersbank will be able to effectively go into micro finance operations in a big way and make a substantial impact in poverty reduction, especially in the countryside.