Retail Lending For Micro And Small Enterprises

DEVELOPMENT BANK OF THE PHILIPPINES (DBP)
Head Office: Sen. Gil J. Puyat Avenue, cor. Makati Avenue, Makati City

Program Title: RETAIL LENDING FOR MICRO AND SMALL ENTERPRISES

philippine money photo — Photo by Trishhhh

Program Objectives:
– To enhance micro and small enterprises’ access to credit through a simplified procedure and shorter turn around time.
– To improve the DBP’s role in developing micro and small enterprises and help them build up their assets.
– To expand DBP’s loan portfolio for micro and small enterprises consistent with the Magna Carta for MSMEs.

Eligible Projects:
– Any duly registered enterprise of good standing in the community.

Eligible Borrower-MFIs:
– Single Proprietorships
– Partnership
– Corporation
– Cooperative
– Other entities with legal personality to engage in a business enterprise

Coverage: Start-up or existing micro and small enterprises with asset size of not more than PhP15.0 million and with loan requirements of over PhP150,000 but not more than PhP10.0 million.

Eligible Loan Purpose:
– Production
– Working Capital (short-term or permanent)
– Investment and expansion in Plant and/or equipment
– Purchase Order/Letter of Credit Financing (P.O./L.C.)

Terms/Requirements:

Loan Amount: Up to 90% of the Total Project Cost (TPC)

Equity Requirement:
– The borrower shall put up a minimum equity of 10% of total project cost.
– For P.O./L.C. financing, the loans shall be up to 80% of the amount of the instrument or based on actual cost of the goods purchased.

Interest Rates: Prevailing market rate

Fees:
– A one-time service fee shall be charged upon approval of the loan equivalent to P1,000.00 or 0.1% of the loan, whichever is higher
– Documentary Stamp Tax
– Monthly Interest rates are inclusive of GRT and all other fees

Collateral:
– Unregistered Real Estate Mortgage and Chattel on TCT and Equipment
– Unregistered Mortgage on Tax Declaration/CLOA and OCT
– For P.O./L.C. Financing, a Deed of Assignment on Irrevocable P.O./L.C. is accepted provided the term shall not exceed its expiry date
– Other alternative collaterals such as post dated checks (PDCs), assignment of contracts/receivable/inventory

Repayment Terms: Based on enterprise’s development period but not to exceed ten (10) years, payable based on business cash cycle.

Maximum Grace Period:
– Three (3) years on principal for projects with short gestation period.
– Five (5) years on principal and interest on long gestating projects.

Checklist of Requirements:
I. General
– Application form
– Business Registration (from DTI/SEC/CDA/DOLE)
– Business Permit (from LGU)
– Business Evaluation Form (for loans above PhP1 million)

For Corporations and Cooperatives
– By-Laws and Articles of Incorporation/Cooperation
– Board Resolution and Secretary’s Certificate authorizing the loan, indicating the authorized signatories

II. Additional Requirements (if applicable)
Real Estate Collateral
– Two copies of Sketch/Location Map
– Two copies of TCT/OCT

Chattel Collateral
-Affidavit of Ownership and Certification of Non-Encumbrance with specifications
-Copy of OR/CR for transportation equipment

Checklist of Requirements:
– Loans PhP1.0 million and below:
– Utility/Credit card billings or three (3) months bank statement

Franchise:
– Business Profile of Franchisor
– Photocopy of Franchise Agreement
– Endorsement by Franchisor
– Franchise Package Kit

Term Loan (Start-Up):
– Business Plan
– Statement of Assets, Liabilities and Networth of Principal Borrower/s
– Bank Statement for at least three (3) months
– Business Evaluation Form

Term Loan (Existing):
– Financial Statements for the past three (3) years (in house financial statements acceptable)
– Business Plan
– Business Evaluation Form

Dealership:
– Photocopy of documents submitted to the mother company
– Dealership Contract
– Letter of Endorsement from mother company/supplier

Credit Line:
– Bank Statement for at least three (3) months
– Projected Cash Flow
– Projected Income Statement

Purchase Order (P.O.)/Letter of Credit (L.C.) Financing:
– Projected Cash Flow
– Projected Income Statement
– Copy of Irrevocable L.C./P.O.

Contact Details:

SVP Brillo L. Reynes
Phone: (632) 817.0473
Head, Small & Medium Enterprise Department

SM Romeo B. Carandang
Phone: (632) 892.2357
Head, SME Unit Trunkline: 818.9511/9611 loc. 2546