THE Cebu Chamber of Commerce and Industry (CCCI) pledged to link budding entrepreneurs with the right financial institutions to help their businesses prosper.
Kate Dychangco-Anzani, chairperson of the upcoming Entrepreneurship Conference and Expo during the Cebu Business Month in June 2017, said the chamber has invited private financial institutions and state-run financial organizations to make sure aspiring entrepreneurs will be able to take advantage of available funds in the market.
“This forum would help budding entrepreneurs not only learn from the bigwigs in the industry, but also know more about financing opportunities and how to maximize all these financial grants,” said Anzani.
The Entrepreneurship Conference and Expo is slated on June 20 to 22, 2017.
Anzani noted that access to capital remains a concern among micro and small businesses, and is the reason many of them access operating funds through informal channels, like the 5-6 lending scheme.
Bartholomew Brillo Reynes, president and CEO of the Small Business Corp., said programs are already in place to help micro and small players access loans to grow their business.
With the government’s thrust to plug all entrepreneurs into the formal financial system, Reynes said the Duterte administration has set up a micro fund program called Pondo sa Pagbabago at Pag-asenso (P3) to replace the popular 5-6 lending scheme.
Department of Trade and Industry (DTI) Secretary Ramon Lopez said the P3 is designed to bring down the interest rate at which microfinance is made available to micro enterprises. The 2017 General Appropriations Act includes an initial funding of P1 billion for financial assistance, a part of the planned P19-billion financing initiative for micro and small businesses in the next five years.
Reynes said the program is being pilot-tested in the poorest provinces.
“The P1-billion fund is a trial fund. If proven successful, the government intends to pool a bigger fund per region,” said Reynes during his talk with the Institute of Corporate Directors-Cebu.
Priority beneficiaries of the P3 program include microenterprises and entrepreneurs who lack easy access to credit, or are accessing credit at very high costs, such as micro-entrepreneurs, market vendors, agri-business owners and members of cooperatives, industry associations and co-operators.
Loanable amount per end-borrower can range from P5,000 for start-ups to P300,000, with maximum interest rate of 26 percent per annum and no collateral requirement. This rate is significantly below the 20 percent per day, week or month charged by 5-6 lenders. It is also lower than what is charged by most microfinance institutions.
Published in the SunStar Cebu newspaper on May 20, 2017.
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