MSMEs in tourism sector to get P6-B in loans
The Department of Tourism (DOT) and the Small Business Corp. (SBC) on Monday signed a memorandum of agreement for a government loan program for micro, small, and medium enterprises (MSMEs) in the tourism industry that were hit by the coronavirus pandemic.
Signed by Tourism Secretary Bernadette Romulo-Puyat, SBC president and chief executive officer Ma. Luna Cacanado, and Trade Secretary Ramon Lopez, the agreement seeks to disburse P6 billion worth of loans to tourism MSMEs, using the budget allocated to SB Corp.’s COVID-19 Assistance to Restart Enterprises (Cares) program.
Republic Act No. 11494 or the Bayanihan to Recover As One Act directed SBC to expand its loan programs, including that for tourism, and “to administer loans for the DOT but subject to guidelines from the DOT.”
The loan program for the tourism sector MSMEs under Cares is dubbed Tourism Rehabilitation and Vitalization of Enterprises and Livelihood.
“We look forward to working with SBC in providing our tourism enterprises with what they need—access to working capital loans,” Puyat said in her message.
“By working together, we can hopefully bring tourism, an industry that contributed 12.7-percent to the country’s 2019 gross domestic product, back to its glory days,” she added.
No collateral
Through Cares for Travel, tourism MSMEs will have access to zero interest, no-collateral loans with a loan term period of up to four years, including a corresponding grace period of up to one year.
The borrower MSMEs would only need to pay a one-time service fee, which is set at a maximum of 8 percent for a four-year-loan.
SBC would evaluate and process all loan applications of DOT-accredited MSMEs and local government-accredited small-scale tourism-oriented enterprises to ensure their eligibility and would determine the loanable amount and terms in accordance with the Cares for Travel guidelines.
For the DOT’s part, Puyat said the agency would “regularly endorse” to SBC a list of DOT-accredited tourism enterprises and LGU-accredited small-scale tourism-oriented enterprises that may be entitled to avail of business loans under the Cares for Travel, subject to further evaluation by SBC.
“We also recognize the need for tourism MSMEs to have access to financial assistance or funds just to tide them over the present pandemic crisis,” Puyat said.
Under the agreement, SBC will regularly submit loan implementation reports to the DOT subject to compliance with the Data Privacy Act of 2012.
