LAND BANK of the Philippines (LANDBANK) launched a loan program on Sunday to finance local government unit (LGU) tourism facilities and services, as well as tourism enterprises accredited with the Department of Tourism.
The bank allocated an initial P5 billion for the Tourist Infrastructure and Services Mobilization program, it said in a statement.
“LANDBANK is committed to supporting the National Government’s efforts to restore confidence and enthusiasm for the tourism sector that will help boost economic activity, and create livelihood opportunities in tourist areas nationwide,” LANDBANK President Cecillia C. Borromeo said.
LANDBANK said projects eligible for loans include primary tourism support facilities, hotels, resorts, automation and digitalization programs for services by travel agencies, facilities for meetings and conferences; secondary tourism projects like restaurants, adventure facilities, shopping malls, ambulatory clinics and spas; and tertiary hospitals, among others.
The bank added that LGUs may borrow 100% of the total project cost under the program, but only up to their net borrowing capacity as certified by the Bureau of Local Government Finance.
Small and medium enterprises and cooperatives may borrow up to 80% of the total project cost while large corporations will be allowed to borrow up to 75%.
LANDBANK said that under the program, short-term loans for working capital are payable after up to one year while loans for permanent working capital are payable after up to five years.
“Meanwhile, term loans for capital expenditures are payable based on projected cash flow up to a maximum of 15 years, with a two-year grace period on the principal repayment,” the bank added.
For the acquisition of tourist transport facilities and units, term loans are not to exceed seven years or the economic useful life of the financed equipment. — Aaron Michael C. Sy