Small businesses looking to restart their operations during the pandemic may apply for interest-free, collateral-free government loans by creating an account at www.BayanihanCARES.ph.
Small business owners can type in their pertinent details and upload scanned identity and business documents on the website, which is maintained by the Small Business Corporation (SBCorp), an attached agency of the Department of Trade and Industry (DTI).
SBCorp is the program implementer of the Bayanihan CARES (Covid-19 Assistance to Restart Enterprises), which makes P8.08 billion available for micro, small, and medium enterprises (MSMEs), cooperatives, hospitals, tourism businesses, and repatriated or displaced Overseas Filipino Workers (OFWs) affected by Covid-19 pandemic.
Under the program, qualified loan applicants can apply for loans ranging from P10,000 up to P5 million, depending on their pre-pandemic sales and business assets figures, if applicable.
The loans are payable up to a maximum of four years, inclusive of a maximum grace period of 12 months for Non-Tourism MSMEs, or a maximum grace period of 24 months for Tourism MSMEs accredited by the Department of Tourism (DOT) or registered as Barangay Micro Business Enterprise (BMBEs).
Successful loan applicants will only need to pay a one-time service fee, set at a maximum of eight percent for a four-year loan term. Lower service fees apply to shorter loan terms.
SBCorp also enhanced its requirements to enable more MSMEs to benefit from the highly concessional loan terms under the program. For instance, MSMEs that have been operational for at least one year as of their date of application may now qualify for the loan. SBCorp’s previous requirement was for MSMEs to be operational for at least one year before 16 March 2020 when the community quarantine was imposed in the country. This is in recognition of the fact while most MSMEs chose to adapt to the new operating environment, some have chosen to pivot to or establish entirely new businesses.
The Bayanihan CARES Program also has a special window for tourism and travel-related industries (CARES for TRAVEL) with a fund allocation of P4.0 billion, and a start-up loan program for repatriated or displaced OFWs who want to start their own businesses (CARES for HEROES).
To date, SBCorp has approved 31,700 MSME loan applications. These correspond to a total loan amount of P4.84 billion.
SBCorp president and CEO Ma. Luna E. Cacanando emphasized that it is focused solely on helping make funds available for small business owners.
“SBCorp operates on the principle that we should not duplicate what the mainstream players in MSME finance are already doing,” she said. “We do not compete with what is already working in the market. What we need to do is fill in the gaps for small businesses that banks and lending companies do not yet find attractive to finance relative to their profit objectives and cost management thresholds. We develop and operate our financing programs for MSMEs along these lines.”
Cacanando said its financing programs — including Bayanihan CARES — are now fully electronic and fully operational. As a result, the agency’s MSME borrowers no longer need to go to its offices, unless they request it.