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RETAIL LENDING PROGRAM > Working Capital Financing > Short-Term



FINANCING FOR INFORMATION TECHNOLOGY BUILD-UP

Credit Line for MSME IT-Capability

Program Description

A one-year revolving credit facility of Small Business Corporation intended to help micro, small and medium enterprises (MSMEs) develop some degree of IT capability in terms of simple hardware facilities, software solutions, website development, and training and tutorial packages.

Loan Scheme

The loan is through a rediscounting scheme using IT providers as the conduit and primary borrower. The MSMEs purchase from IT providers its IT packages through credit, payable in six to twelve monthly installments. The receivables of the IT provider from the MSMEs shall be the subject of SBC financing. (IT provider refers to distributors of ready-made IT packages such as hardware and software.)
  • Minimum Borrower Qualification

    • IT Provider:

      1. Must be a local SME corporation
      2. Must have an asset size not less than P500 Thousand and more than P100 Million (excluding the value of land)
      3. Must have at least two years profitable track record in the industry
      4. Must have a BRR score of “5” or better per SBC evaluation

    • MSME Borrower:

      1. Must be a Filipino-owned enterprise
      2. Must have an asset size of at least P200 Thousand
      3. Must have a positive net income for the past immediate year

  • Product Features

Type of Facility

One-year Credit Line

Purpose of Loan
  • For conduit/IT provider

-Working Capital

  • For MSME end-borrower

-Acquisition of hardware facilities, software solutions and IT packages for website development, training and tutorial and other IT-related undertakings

Loan Amount
  • Minimum of P200,000
  • Up to P10.0 Million for medium-sized IT providers
  • Up to P5.0 Million for small IT providers
  • Financing not to exceed P200,000 per MSME-buyer

Loan Availment
  • The IT provider shall avail of drawdown on the credit line which shall be payable quarterly for not more than 18 months, inclusive of three months grace period on principal
  • Drawdown shall have a sub-limit of P500 Thousand which should be liquidated prior to the next availment

Repayment Term
  • One-year Credit Line – up to 180 days term per drawdown
  • To be amortized quarterly for not more than 18 months, inclusive of 3 months grace period on principal

Collateral Requirement
  • Continuing Surety Agreement of the owners
  • May be on clean basis up to P1.0 Million, beyond which the loan should be at least 50% secured by REM or CHM on motor vehicle

Other Terms of Financing
  • The IT provider shall offer package offerings, payable in six to  twelve months, as supported by postdated checks (PDCs) of the SME buyer
  • The SME buyer should be required to make a deposit of at least 20% on the cost of the IT package
  • Documentary Requirements for Liquidation (as a pre-loan release requirement every drawdown)

    • Notarized promissory note and amortization schedule between the IT provider and the SME buyer, and with assignment thereof in favor of SBC
    • Notarized deed of undertaking by the SME buyer allowing the IT provider to pull out IT package in case of default on payment
    • Photocopy of the SME buyer’s PDCs
    • SME buyer’s ITR-financials
    • SME buyer’s information sheet/CI as gathered by the IT provide

 

For more information about our products, please contact us:

Small Business Corporation
Development Finance Group
Telephone No. 751-1888
or at any SBC office nearest you.

(Link to SBC area offices directory)