The bicameral conference committee adopted the initiatives of the House of Representatives in Bayanihan 2 to support the recovery of distressed micro, small, and medium enterprises (MSMEs) from the financial losses caused by the coronavirus pandemic, House Speaker Alan Peter Cayetano said on Friday.
The House of Representatives is set to ratify the bicameral committee report on Monday, August 24.
“The swift approval of ‘Bayanihan to Recover as One’ in the bicameral committee has shown the joint commitment of both Houses of Congress to unite and help bring our nation back from the brink of public health and economic ruin brought about by this global pandemic,” Cayetano said.
Under the bicam-approved measure, low-interest loans will be made available to productive sectors of the economy especially in the countryside, including self-employed individuals, cooperatives, and MSMEs.
The measure also provides that lending institutions will not require collateral for loans not exceeding P3 million, with loans payable within three years.
Of the P140-billion appropriations provided under the measure, Bayanihan 2 seeks to infuse a total of P39.47 billion worth of capital to Government Financial Institutions (GFIs), broken down as follows:
P10 billion to the Small Business Corporation (SBCorp) to strengthen its COVID-19 Assistance to Restart Enterprises (CARES) program to ensure additional access to working capital for MSMEs, cooperatives, hospitals, tourism industry players, and overseas Filipino workers (OFWs);
P5 billion for the credit guarantee program of the Philippine Guarantee Corporation (PHILGUARANTEE);
P18.47 billion for Land Bank of the Philippines (LBP); and
P6 billion for Development Bank of the Philippines (DBP)
Another P15.52 billion has been included in the standby fund for the LBP and DBP to be made available once additional funds are generated from savings and unused amounts.
While only P140 billion is readily available, the overall stimulus funding under Bayanihan 2 has authorized the spending plan of up to a maximum of P165.5 billion, which includes a total of P25.5 billion standby fund.
Based on the approved bill, the combined regular appropriations and stand-by fund for the government financial institutions will total P55 billion, which is equivalent to one-third of the entire package.
Cayetano said MSMEs in the agri-fishery, transport, health, and tourism sectors as well as cooperatives and OFWs can avail themselves of the various loan facilities to help them reboot their businesses and preserve more jobs.
He cited a June 20 report from the Department of Labor and Employment (DOLE) that showed more than 3,000 establishments nationwide permanently closing or cutting back their workforce due to the pandemic, leaving 90,000 people jobless.
“With adequate support from government and strong collaboration with the private sector, we hope to reverse the trend of joblessness and restore business confidence in the country as we strengthen our fight against COVID-19,” he said.
Cayetano assured small business owners that the government will continue to find solutions that will bring about short- and long-term benefits as the country recovers from the health and economic crisis.