Small Business Corp. (SB Corp.), an agency attached to the Department of Trade and Industry (DTI), said it approved 32,823 loan applications from its Covid-19 Assistance to Restart Enterprises (Cares) program with one loan application fully digitized system.
In a statement, SB Corp. said this corresponded to a total loan amount of 5.1 billion pesos out of the 8.08 billion pesos available for micro, small and medium enterprises (MSMEs), tourism businesses, cooperatives, hospitals and returnees or displaced abroad. Filipino workers (OFW) affected by the Covid-19 pandemic.
Cares is an interest-free, unsecured funding program that aims to help MSMEs recover from the adverse effects of the pandemic.
MSME borrowers will only have to pay a one-time service charge, which is set at a maximum of 8% for a loan term of 4 years.
SB Corp. fully digitized its lending processes shortly after last year’s lockdown.
Evelyn Felias, head of SB Corp’s information technology group, said she planned to digitize its financial services as early as 2019 and was able to implement it when the lockdown began.
The digital process starts from registering the potential borrower, submitting the required documents and approving, until the loan is released.
In a previous forum, Commerce Secretary Ramon Lopez noted that about 73% of small businesses in the Philippines as of September last year needed capacity building initiatives or support to digitize their businesses. .
DTI conducted a study and noted that the Philippines lags behind its Association of Southeast Asian Nations (Asean) neighbors in adapting digital transformation to their businesses.
He noted that the Philippines is at “zero level” or “below baseline” in the ASEAN business digitization categories.
Small businesses in Asean fall into the basic category when using email and mobile devices in their business. The middle category is when they start selling online, while the advanced category uses data analytics in their businesses.
Deputy Secretary Jean Pacheco, who heads the DTI e-commerce program office, noted that in view of the statistics, DTI is striving to innovate and implement programs within the framework of the roadmap. e-commerce 2022 that can empower MSMEs to rebuild themselves by providing them with national and international services. market access, digitization and logistics integration.
“We found that 23% of [our] respondents have cell phones but they do not use them for business purposes, only for personal purposes. This is what we are trying to do at DTI, we need to identify what level they are in or what category they fall into so that the appropriate intervention can be given to that particular MSME in their digital transformation journey, ”said Pacheco.
Pacheco said digitalization in businesses is expected to accelerate, especially e-commerce adoption, citing the 2021 digital report showing that 80% of internet users have purchased something online.