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RETAIL LENDING PROGRAM > SME FIT

 

SME-FIT
Financing for Information Technology Build-up

Program Description

A medium-term loan facility of Small Business Corporation intended to help MSMEs develop some degree of IT capability. This may be in a form of simple hardware facilities, software solutions, website development, training and tutorial packages, and other IT-related undertakings.

  • Product Feature
Type of Facility One-year Credit Line
Loan Scheme
  • 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
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
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
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 Cover
  • 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
  • Minimum Borrower Qualifications
    1. The IT provider must be a local SME corporation; IT provider refers to distributors of ready-made packages i.e. hardware, software and IT-related services
    2. With at least two years profitable track record in the industry, with BIR-filed net income of not less than P10,000 for the past immediate year
    3. Asset size not less P500 Thousand and more than P100 Million (excluding the value of land)
    4. Latest financial ratios (based on in-house financials)
      • At least 1.2 current ratio
      • At most 70:30 debt-equity ratio
  • Documentary Requirements for Liquidation (as a pre-loan release requirement every drawdown)
    1. Notarized promissory note and amortization schedule between the IT provider and the SME buyer, and with assignment thereof in favor of SBC
    2. Notarized deed of undertaking by the SME buyer allowing the IT provider to pull out IT package in case of default on payment
    3. Photocopy of the SME buyer’s PDCs
    4. SME buyer’s ITR-financials
    5. SME buyer’s information sheet/CI as gathered by the IT provider

Documentary Requirements for Loan Application

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