Calls for more loans for MSMEs in Philippines

• Jun 28, 2019

The array of small- and medium-scale businesses that contribute up to 62.5 per cent of employment and comprise 99.5 per cent of all businesses in the Philippines were getting only 9.2 per cent of loans and financing from the country’s major banks.

These figures prompted the Union Bank of the Philippines to ask its fellow financial institutions to recognise the key role micro, small and medium enterprises (MSMEs) play in the Philippine economy and allocate more of their money to help these MSMEs thrive, at least.

To help MSMEs thrive, Unionbank is offering a digital platform, called UnionBank GlobalLInker, to allow entrepreneurs to promote their brands, products and services and get access to financial assistance and other solutions.

Maurese Soriano, UnionBank programme manager, said the platform would help “address restraints on capital and other sources of funding” besetting MSMEs.

Pia Roman-Tayag, Bangko Sentral ng Pilipinas managing director, at a recent forum cited a World Bank report that showed some 81.2 per cent of Philippine businesses rely on internal funds to finance expansion or keep themselves alive. Only 0.1 per cent have access to bank financing, which was seen as a key ingredient of growth.

Tayag said smaller firms do not know where to turn to for financing while financing institutions have been limited in their assessments of small businesses because of their lack of credit history. PHILIPPINE DAILY INQUIRER