Different government agencies and institutions offer business financing programs to aspiring entrepreneurs in the country. 

Securing the capital to launch a business is a problem that many entrepreneurs must deal with. In particular, MSMEs (medium, small and micro enterprises) can find access to capital difficult. Many times, the challenge of business financing alone is enough for entrepreneurs to abandon their business altogether. 

This, however, should not be the case as there are many avenues to raise capital. One such way is through government business financing programs, which are available through different government agencies and institutions.

It’s important to note each program has its own set of requirements, and not all applicants may qualify. It is important for interested entrepreneurs to practice due diligence and do their research before applying for any of the programs listed below. 

Credit Surety Fund (CSF)

A credit enhancement scheme developed by the Bangko Sentral ng Pilipinas (BSP), CSF aims to increase the creditworthiness of MSMEs, particularly those that cannot obtain loans from banks. CSF caters to MSMEs that do not have acceptable collaterals and have a low paying capacity.

“The Fund shall serve as a security for loans of MSMEs in lieu of acceptable collaterals,” said the BSP.

The CSF is created by pooling together the contributions of the following:

• Cooperatives
• Non-government organizations (NGOs)
• Local government units (LGUs)
• Partner institutions (such as Landbank)
• Donors
• Other government agencies

Given this, cooperatives and NGOs, as well as their MSME members, are the ones who are eligible to borrow through the CSF.

More details about the CSF, including minimum requirements, can be found here.

Business Financing Programs of SB Corp

The Small Business Corporation (SB Corp) is a government corporation under the policy program and administrative supervision of the Department of Trade and Industry (DTI), specifically its Small and Medium Enterprise Development (SMED) Council. 

SB Corp offers MSME financing programs that are either corporate funded or funded by the national government. Under the corporate funded program are the following:

• Regular retail program
• Regular wholesale program
• Venture capital program 

As for financing programs funded by the national government, there is what is known as the P3 Lending Programs. 

According to SB Corp, financing is “Designed to be lent out to micro enterprises borrowers with asset size not exceeding PHP 3 million at not more than 2.5% per month all-in interest rate and service charges.” 

“This 2.5% monthly cap is an effective rate, based on diminishing balance of the principal portion of the loan,” SB Corp added. 

More details on SB Corp’s financing programs, including requirements, can be found here. 

Landbank Lending Programs 

Government-owned Landbank offers different lending programs that each cater to specific industries or sectors. Any example of which is the Franchising Lending Program, which aims to provide credit assistance for both franchisees and franchisors. 

Landbank also offers a financing program for those in the farm tourism industry, including those who want to develop or improve farm tourism sites and camps. Those who need funding for crop, livestock, and fishery production and marketing are also eligible for this program. 

More information about these programs as well as other programs that Landbank offers can be found here.