Muntinlupa City has lived up to its name as the most business friendly local government unit in the country as it extended loan assistance to 117 budding entrepreneurs at zero percent interest.
Mayor Jaime Fresnedi awarded the cheques amounting to P1.7 million to the first quarter beneficiaries of the city government’s Tulong Negosyo program.
“The local government is committed to help our micro, small and medium-sized enterprises and grassroots players making up the totality of Muntinlupa’s economic scene so their businesses can thrive in the city,” Fresnedi said.
Among the first quarter beneficiaries were two “Muntipreneurs” who received P120,000 each loan assistance – Ronalyn Benitez, who owns a fish delivery business and a carenderia, and Joel Nueva, who runs a bakery and a sari-sari store.
The Tulong Negosyo program has been extending zero-percent interest financial assistance from P2,000 up to P150,000 to MSMEs depending on their business capital ceiling and payment record.
Fresnedi said financing budding entrepreneurs is one way to address the challenges of urbanization.
Helping increase the income of his constituents, the mayor said, will likewise create sustained economic growth for the city.
Beneficiaries are also required to undergo training on savings to serve as safety net for their earnings and to ensure sustainability of the Tulong Negosyo program, with five percent of the loanable amount automatically saved in a designated bank.
Since its inception, the Tulong Negosyo program has already extended loan assistance to some 5,600 MSME beneficiaries.
The loan assistance is significant for MSMEs which have little access to bank financing (only 6 percent of Filipino entrepreneurs obtain credit from financial institutions, thus stunting growth) and are exposed instead to the ubiquitous 5-6 lending.
“MSMEs are unable to reach their full potential due to a range of barriers, including financial access,” Bangko Sentral ng Pilipinas Governor Nestor Espenilla said.
“Bank lending to MSMEs leaves much to be desired, comprising only 8.4 percent of total loan portfolio,” Espenilla added.
Credit-starved MSMEs ironically account for 99.5 percent of all registered businesses in the country. They also contribute the biggest share of total jobs generated at 61.6 percent.
Aware of the challenges faced by MSMEs, the Muntinlupa city government, in partnership with the Department of Trade and Industry, also launched a Negosyo Center in a bid to promote ease of doing business and facilitate access to services for small businesses.
Fresnedi said the Negosyo Center will be assisting local enterprises through the following services: business registration assistance, business advisory services, business information and advocacy, and monitoring and evaluation.
“MSMEs can coordinate with Negosyo Center for registration and renewal application as well as provision of grants and other forms of financial assistance,” the mayor said.