MANILA, 13 June 2018 - An additional P4 billion budget of Department of Trade Industry (DTI) President Duterte wants to provide for microlending program to drive away businesses out of loan sharks. 

During the cabinet meeting, 11th of June, Department of Agriculture (DA) Secretary Emmanuel F. Piñol said that such budget was mentioned by the President together with other government officials during the spike of retail prices of farm products. 

In an interview with BusinessMirror, the DA Secretary said that, "During the Cabinet meeting, the President said he may have to add another P4 billion to the DTI’s lending program this year.”  

Piñol also added, “The target right now is to neutralize predatory loans extended to vendors, who, because of the onerous interest rates, are forced to hike their prices to recoup their cost. At the end of the day, it is only the loan sharks who are earning." 

Pilot Testing of P3 Program 

DTI is currently on its pilot testing of Pondo sa Pagbabago at Pag-Asenso (P3) Program which seeks to become the alternative of the "5-6" lending system in the Philippines. The program also aims to provide MSMEs access to affordable credit by allowing them to loan from P5,000 for start-ups, to P300,000 with a maximum interest rate of 26 percent per annum with no collateral requirement. 

$350 million for SME trade financing - ADB 

The Asian Development Bank (ADB) approved the $350 million as an additional funding in bridging gaps in trade financing for SMEs. ADB understands that SMEs play significant role in global trade finance gap which amounts to $1.5 trillion, 40 percent of which is coming from the Asia and Pacific region. Trade finance will further aide countries in achieving its Sustainable Development Goals as determined by the United Nations’ Addis Ababa Declaration on Financing for Development. 

Source: Business Mirror & Philippine Star