The Small Business Corporation
Small Business Corporation (SBCorp) is the result of the merger between the Small Business Guarantee and Finance Corporation (SBGFC) and the Guarantee Fund for SMEs (GFSME), under Executive Order No. 98 issued in November 2001. SB Corp’s focus is to provide access to finance, financial management and capacity building to MSMEs. It has several programs for the MSME market: wholesale lending to smaller financial institutions, cooperatives and foundations; retail or direct lending to micro, small and medium enterprises (MSMEs); and guarantee programs for larger banks to cover MSME loans without collateral or with insufficient collateral. SB Corp also provides financial management and capacity building for rural banks (RBs) with its (SB Corp) Borrower Risk Rating (BRR) System program.
Programs and Program Beneficiaries
Small Business Corporation envisions becoming the leader in small enterprise development financing and small credit delivery systems nationwide. The Corporation has focused on developing an appropriate mix of financing products that are responsive to the needs of SMEs in the country.
Over the years, the Corporation has evolved its product line from generic credit and credit enhancement facilities—catering to both nearly bankable SMEs and small banks in need of liquidity support—to more evolved lines that focused the financing facilities to specific products and/or sectors.
The Corporation's credit facilities includes wholesale and retail lending programs, which targets banks engaged in MSME lending, and pre-bankable small to medium sized businesses. The credit guarantees services banks with SME accounts that need additional collateral cover.
The Corporation also provides capacity building programs for banks and MSME clients. Training programs varies from computerized accounting and enterprise development training for MSME's to Risk-based lending to SMEs for financial institutions.
1. Wholesale lending for SMEs.
Wholesale funds are coursed through or “conduited” to our partner banks and institutions for re-lending to “already bankable” SMEs.
Our Wholesale lending facilities can be accessed by SMEs by applying for SME loans through our partner banks and institutions.
2. Microfinance Wholesale Lending Program
Open to partner rural banks, microfinance institutions, and cooperatives, who in turn, re -lend the funds to eligible “pre-enterprises”.
The pre-enterprises we assist include the graduating and start-up micros. (Graduating micros refer to those unregistered yet existing enterprise that are willing to register as an enterprise, have a livelihood track record as well as credit track record with a micro-finance institution, and with tangible assets. Start up micros, on the other hand, are starting enterprises that do not meet these qualifications yet.)
3. MSME Retail Lending Program
Open to registered micro, small and medium enterprises (MSMEs). The program is intended to bridge the financing gap of what we refer to as the “pre-bankable but viable” MSMEs that are at the moment “unserved” by the banking system. Through this program, we hope to provide a conducive environment for MSMEs by financing their business needs, training them to get credit track record and experience, and building up business size necessary to access bank financing in the future. Direct lending facilities are available for manufacturers, suppliers, traders, exporters, franchisers, and service providers among others.
Ownership and Legal Status
SB Corp is a government corporation created on January 24, 1991 by virtue of Section 11 of RA No. 6977, amended on May 6, 1997 by RA 8289, otherwise known as the Magna Carta for Small and Medium Enterprises. SBGFC is under the policy program and administrative supervision of the Small and Medium Enterprise Development (SMED) Council of the Department of Trade and Industry (DTI), the primary agency responsible for small and medium enterprises in the country.