STATE-RUN Land Bank of the Philippines (LANDBANK) plans to expand its lending program for small businesses and cooperatives further to extend credit to more borrowers at a lower interest rate.
LANDBANK said in a statement on Sunday that it will create a sub-credit facility under its lending program for micro, small and medium enterprises (MSMEs) and cooperatives called the Interim Rehabilitation Support to Cushion Unfavorably affected Enterprises by COVID-19 or I-RESCUE program.
The new facility will allow MSMEs, cooperatives and self-employed individuals to take out at least P100,000 in loans or up to 85% of the working capital they need. The loan carries a fixed interest rate of 3% per annum and matures in three years.
“We are enhancing the I-RESCUE lending program to cover a wider range of key industries that need greater access to credit. LANDBANK is keeping in step with emerging requirements under the new normal in support of the country’s ongoing economic recovery,” LANDBANK President and CEO Cecilia C. Borromeo was quoted as saying.
The program was created in April 2020 to help small businesses cope with the impact of the coronavirus pandemic by extending low-interest loans and restructuring schemes. It is available until the end of 2022.
LANDBANK has approved P6.95 billion of loans to 227 borrowers under the program as of January. Of this total, it has already released P5.28 billion to 167 MSMEs, 34 cooperatives, four microfinance institutions and three large companies.
LANDBANK received a P27.5-billion equity infusion from the government last month as authorized by Republic Act No. 11494 or the Bayanihan to Recover as One Act to expand its lending program for affected sectors.
The lender’s net income dropped by 7.57% to P17.1 billion in 2020 from P18.5 billion in 2019. — BML