
Small Business Corporation
ESSENTIAL STATEMENTS OF SMALL BUSINESS CORPORATION
Small Business Corporation delivers its message of commitment, service and integrity towards its mandate as defined under the Magna Carta for MSMEs by adopting the following statements that guide the entire organization:
Vision Statement
By 2025, we will be the leader in building financing alternatives for Philippine MSMEs, putting them at the forefront of inclusive economic growth.
Mission Statement
Our Mission is to relentlessly champion the neglected business segments of the country to get them to access the capital needed to grow successfully.
In the delivery of our mission, we commit not to contribute to the cycle of debt poverty and to ensure no pilferage in the use of NG investment. We also commit not to duplicate already existing interventions in the financing industry especially those mainstreamed among private industry players.
Social Outcome Objective
To cause prosperity among MSME segments traditionally considered unfinanceable, thereby increasing economic diversity and inclusion (we define unfinanceable segments as enterprises which despite their being an on- going business are not able to access finance at non-usurious rates).
7 Target MSME Segments
- Micro and small agri and aqua enterprises
- Micro retailers
- Small island economies
- MSMEs requiring rehabilitation arising from disaster
- Islamic MSMEs
- Indigenous people (IP) – owned enterprises
- First-time small businesses
Service Philosophy
Ferocity in the mission, Kindness towards each other.
Core Values
- Matapat sa Bayan (faithful and trustworthy service to the country)
- Magaling at Maabilidad (competent and innovative)
- Bayanihan (community in unity)
Corporate Logo
After 30 years, the SBCorp identity gets a timely refresh with the utmost respect to the legacy of impact the institution has brought to Philippine MSMEs. With bolder, retrofitted elements adapted for a digital world, the new logo introduces SBCorp as the government agency “Where Philippine MSMEs Go to Grow.”
Through this new identity, SBCorp recommits to fight for an educated, engaged, and empowered MSME ecosystem with an unquestioned contribution to the socio-economic upliftment of the Philippines.
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 micro, small and medium enterprises the much needed access to finance to help them grow their businesses. It has several programs for the MSME market: wholesale lending to smaller financial institutions, cooperatives and foundations and retail or direct lending to micro, small and medium enterprises (MSMEs).
Programs and Program Beneficiaries
Corporate Funded Programs
Using its own corporate funds, SBCorp is engaged in a) Regular Retail Lending for duly registered MSMEs and b) Venture Capital for selected start-up MSMEs.
Program: Regular Retail Lending
Priority Beneficiaries: Targeted Micro and Small Enterprise Markets
Program: Venture Capital Program
Priority Beneficiaries: Selected Start-up MSMES thru Partner State Universities and Colleges
National Government- Supported Programs
Program: Enterprise Rehabilitation Financing
Priority Beneficiaries: MSMEs who suffered business reversal from calamity
The program was initially funded by corporate funds when it started in January 2014. SB Corp allotted around P 600 million in support of MSMEs badly affected by Typhoon Yolanda
In response the National Government (NG) granted P200 million credit risk subsidy to SB Corp.
Program: Pondo sa Pagbabago at Pag-asenso (P3)
Priority Beneficiaries: Microenterprises who are economically active
The National Government implemented its P3 Fund for microenterprises (MEs) starting 2017 via a GAA allocation for SB Corp.
The strategic objective is to provide all MEs that are economically active in all 81 provinces throughout the country, the opportunity to access credit at more reasonable interest rates capped at 2.5% per month.
Not more than 5% of the P3 fund was allocated to higher risk sectors such as internally displaced persons (IDPs) arising from war in Marawi, killed and wounded in action (KIA/WIA) soldiers or their families, MSMEs affected by the temporary closure of Boracay Island and MEs affected by earthquake in Batanes.
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.
RISE UP is a loan program that aims to sustain the gains of MSMEs that have survived the past two years of crisis, by providing multi-purpose loans that have soft terms and can be easily accessed. The RISE UP Multi-purpose Loan caters multi-sectoral MSMEs inclusing existing SBCorp borrowers.
What are the products and who are qualified to borrow?
- Micro Multi-Purpose Loan is for multi sectoral microenterprises.
- SME Multi-Purpose Loan Suki is for existing borrowers of SBCorp in good standing with atleast 6 months repayment track record.
- SME Multi-Purpose Loan First Timers is for multi-sectoral SMES.
Enterprise Rehabilitation Financing (ERF) Program for Typhoon Odette affected MSMEs
Small Business Corporation (SBCorp) is pleased to announce the opening of the Enterprise Rehabilitation Financing (ERF) Program for MSMEs affected by Typhoon Odette.
The program is open to all MSMEs operating in areas declared under a State of Calamity due to the typhoon.
1.Existing Borrowers – MSMEs with existing loan with SB Corp
2. New Borrowers – MSMEs without existing loans with SB Corp
3. Tourism MSMEs – May be existing or new borrowers
STAPLES (Sustaining Trade Access to Primary Food and Link to Enterprises) is a loan product for micro, small, and medium enterprises (MSMEs) in the retail food market’s value chain that are:
- in the supply chain of an SBCorp-accredited Fast Moving Consumer Goods (FMCG) food manufacturer/producer/supplier,
- down to the retail segments of the market.
STAPLES is highly relevant to food sufficiency and availability. It aims to assist MSMEs replenish their working capital and fund other business purposes. It will also help sustain the food supply chains, and maintain sufficiency and affordability. By enabling MSMEs to continue their operations, it will help save jobs and increase their business to make a bigger contribution to our economy.
Who are eligible to apply?
- MSMEs in the retail food business sector, which are part of the supply chain of an SBCorp-accredited FMCG food manufacturer – may be a food producer, ‘trader’ or ‘repacker’
- Retailers and wholesalers of food items of SBCorp-accredited FMCGs such as sari-sari stores, public market stalls, convenience stores, grocery stores, bakeries, micro to small scale food producers or processors, and vendors of farm food produce and seafood
- As major players in the supply chain of SBCorp-accredited FMCG food manufacturers, their distributors and dealers may qualify as well for this loan product, so long as their asset size fall within the definition of a small or medium.
How can FMCG’s be accredited partners for STAPLES
The FMCG food manufacturer/producer must:
- Have an asset size of more than PhP100.0 million;
- Belong to the top 1,000 corporations in the Philippines; and
- Have a nationwide network of at least 20 distributors and at least 100,000 sari-sari stores digitized into their sales force automation system.
What are the Documentary Requirements for Accreditation?
- Letter of Intent to participate in SBCorp’s STAPLES Lending Program;
- General Information Sheet submitted to the Securities and Exchange Commission (SEC); and
- Annual Report
How can MSMEs qualify for STAPLES?
- Must be a micro, small, or medium enterprise in the retail food sector
- Must be a part of the food supply chain of an SBCorp-accredited FMCG food manufacturer:
- For sari-sari stores: in good standing for the past year
- For distributor/s and dealer/s: must have an asset size of a small or medium enterprise; must be in good standing for three (3) years for loans of PhP1.0 million and above
- Must be 100% Filipino owned or at least 60% Filipino-owned for corporations with foreign ownership
- Must have no unresolved major negative credit findings on the applicant and on the enterprises
Helping the Economy Recover Thru OFW Enterprise Start-ups (HEROES)
Our Overseas Filipino Workers (OFWs) have been an economic lifeline of the Philippines, with their remittances contributing nine percent of the country’s Gross Domestic Product (GDP).
For decades they have supported millions of households and have powered the Philippine economy, until the pandemic struck. Over 300,000 OFWs have been sent home in the wake of the COVID-19 pandemic. Many of them have been unemployed, with their savings slowly diminishing.
Helping the Economy Recover thru OFW Enterprise Start-ups (HEROES) is a program of the National Government that provides an opportunity for displaced, repatriated, or returning OFWs to rebuild their lives here in the Philippines by helping them establish their start-up businesses.
FOR REPATRIATED AND RETURNING OFWS WHO WANT TO START THEIR OWN BUSINESS
- Loanable amount from PhP30.0 thousand up to PhP100.0 thousand
- With grace period of up to 12 months
- No collateral required
- No interest
DOCUMENTARY REQUIREMENTS
- Certificate of Completion of Training issued by PTTC
- Scanned copy of passport
- Video presentation (Applicant will be given guidance during the PTTC training)
- Business Model Canvass (For loan amounts above PhP50.0 thousand)
HOW TO APPLY
- Complete a free one-day online training with the Philippine Trade and Training Center (PTTC). Register at http://bit.ly/HEROESRegistrationForm
- Upon completion of the training, prepare the following requirements for your loan application:
- Scanned copy of passport
- Video presentation (applicant will be to prepare the video dugiven guidance on how ring the PTTC Training)
MSME Financing Programs
CORPORATE FUNDED
- REGULAR RETAIL PROGRAM
- Direct lending 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 the 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, franchisers, and service providers.
MINIMUM BORROWER QUALIFICATIONS:
- At least 60% Filipino-owned;
- With asset size of not more than P100.0M exclusive of value of land where project is located;
- Must have at least 2 years profitable business track record
- DTI or SEC registered, whichever is applicable;
- Not belonging to SBC’s exclusionary list of industries:
- Farm level production involving agriculture, aquaculture and/or livestock (post production activities are however qualified);
- Real estate development (MSME contractors are however qualified);
- Pure trading of imported commodities (unless value-added services are employed which impact positively on the domestic market);
- Vice-generating activities
- FIXED ASSET FINANCING
- Loan Purpose:
- Building/Production area improvement
- Service / Delivery Vehicle
- Repayment Term: up to 3 – 5 years depending on the loan purpose
- Collateral: Real Estate Mortgage or Chattel Mortgage
- Loan Purpose:
- WORKING CAPITAL FINANCING
- Loan Purpose: AR and/or Inventory financing for micro and small enterprises who are:
- Not yet ready for a credit line transaction
- Prefers to amortize its working capital loan
- Most probably do not have a working accounting system/recording system
- Type of Loan: 1-Year Credit Line
- Subject of Financing: 80% Receivables; 60% of Inventories
- Loan Purpose: AR and/or Inventory financing for micro and small enterprises who are:
FOR MORE INFORMATION CONTACT OUR RETAIL LENDING TEAM
- +63 2 7751 1888 local 1635 (South Luzon and NCR)
- (082) 221-1488 (Mindanao)
II. REGULAR WHOLESALE PROGRAM
- SME WHOLESALE
Rediscounting window for SME sub-borrowers who are able to meet the following criteria:
MINIMUM QUALIFICATIONS OF SME SUB-BORROWERS:
- At least 60%Filipino-owned;
- DTI or SEC registered, whichever is applicable;
- With positive net income for the immediate past year based on BIR-filed FS;
- DER not exceeding 80:20;
- Not belonging to SBC’s exclusionary list of industries:
- Farm level production involving agriculture, aquaculture and/or livestock (post production activities are however qualified);
- Real estate development (MSME contractors are however qualified);
- Pure trading of imported commodities (unless value-added services are employed which impact positively on the domestic market);
- Vice-generating activities
- GRADUATING MICRO WHOLESALE Lending window for graduating micro-enterprise sub-borrowers who are able to meet the following criteria:
- At least 60%Filipino-owned;
- Any valid business permit (e.g. Mayor’s Permit, BMBE Registration);
- Positive net income for the immediate past year and as of period
- DER not exceeding 80:20
- Total loans inclusive of with PFI’s is not more than P500,000;
- Not belonging to SBC’s exclusionary list of industries:
- Farm level production involving agriculture, aquaculture and/or livestock (post production activities are however qualified);
- Real estate development (MSME contractors are however qualified);
- Pure trading of imported commodities (unless value-added services are employed which impact positively on the domestic market);
- Vice-generating activities
- MICROFINANCE WHOLESALE
- Micro-Lead – for MFIs whose loan portfolio and organizational structure is at least 60% MF
- Micro-Local – for MSME-oriented rural banks
- SME WHOLESALE
III. VENTURE CAPITAL PROGRAM
- Objective
Provide an equity financing to start-up enterprises with high growth potential to develop the business, commercialize and grow their products and services in a sustainable manner.
- ELIGIBLE
Duly registered MSME, organized either as a single proprietorship, partnership or corporation. For enterprises registered as a single proprietorship, the form of ownership must be converted and registered as a corporation.
- AREAS OF FINANCING
Industrial and manufacturing, social services, agri-business, tourism, environmental
- NATURE OF INVESTMENT
common stocks, preferred stocks
- AMOUNT OF INVESTMENT
Amount shall not exceed 40% of the enterprise authorized capital stock. It shall range from a minimum of P500,000 to a maximum of P5,000,000
- TERM OF INVESTMENT
Shall be for a period of 5 to 10 years. It may be extended for another 2 years subject to approval of SB Corp BOD
- EXIT MECHANISM
Redemption, sale to third party, IPO
- Objective
NATIONAL GOVERNMENT FUNDED
P3 LENDING PROGRAMS
Designed to be lent out to micro enterprises borrowers with asset size not exceeding P3.0M at not more than 2.5% per month all-in interest rate and service charges. This 2.5% monthly cap is an effective rate, based on diminishing balance of the principal portion of the loan.
- P3 RETAIL – REGULAR
- Any self-employed or micro entrepreneur engaged in legitimate livelihood or business activity for at least one year can borrow fromP3
- The micro entrepreneur should have a government-issued ID
- The micro entrepreneur should have been issued a Barangay Clearance in the past 3months
- Evidence of micro enterprise activity for at least one year (certification by LGU and/or other government offices is acceptable among others
Proof of one (1) year residence - Loan Amount: P5,000.00 to P200,000.00 depending on the size of the business and the ability to pay. For enterprises with at least one (1) employee, beneficiary can borrow up to P200,000.00. The fund should be used for the enterprise’s expansion and/or additional supplies of the business.
- Interest Rate: not more than 2.5% per month
- P3 RETAIL – SPECIAL FACILITIES (KIA/WIA, MARAWI, BORACAY, OMPONG, REBEL RETURNEES)
*Special considerations are being applied for P3 Implementation of Special Facilities
EQUITY INVESTMENT FOR FAMILIES OF KIA/WIA WITH MICRO ENTERPRISE
- Providing micro enterprise investments for families of KIA/WIAs from P50T to P100T. The investment is interest free if paid within two years. If not, amortization will start on the third year with an interest of 2% per annum.
QUALIFICATIONS OF MICRO ENTERPRISE INVESTEE:
- May be start-ups as DTI will support the KIA/WIA family with trainings and starter-kits.
- With AFP certification on KIA/WIA status of the soldier
*All the KIA/WIA investees will be required to accomplish and submit on monthly basis a simple monitoring template on the progress of their business; they will be taught by SB Corp on how to accomplish the form.
LOAN FEATURES:
- Loan Limit: Up toP100.0T
- Repayment: Being an equity investment, the KIA/WIA family-micro enterprise will return the fund invested by SBCorp once grow this achieved enough to start an amortization of the fund. The investment shall be interest free if returned within two years; otherwise a 2% p.a. fee is to be charged on the investment.
- P3 RETAIL – REGULAR
P3 WHOLESALE
Partner Accreditation Criteria:
- Should have license to engage in lending
- At least 1 year operating as an MFI
- Minimum Capitalization: At least P500T
- Net Income is positive for the past 12 months
- Microfinance Portfolio at Risk: PAR – 30 days should not be more than 20% net of provisioning
- Past Due Portfolio Quality: 20% net of provisioning
- Capital Adequacy Ratio (CAR): 15%
- Debt-to-Equity Ratio (DER): Not to exceed 80:20 after loan
- Liquid Asset to Deposit Ratio: 10% but low liquidity shall not be a disqualifying factor
- Borrower Risk Rating (BRR): BRR 5 or up
- Regulating Agency: SEC, CDA and BSP
LOAN FEATURES: SB CORP. TO CONDUIT
- Credit Line Amount: Based on SB Corp. assessment
- Credit Line Term: 1 year subject to annual review
- PN Term: Up to 24months
- Repayment Term: Monthly or Quarterly
- Interest Rate: 0% on the first year; 2.0% p.a. starting 2nd year based on diminishing balance
- Service Fee: 2.75% (Upfront to be deducted from loan proceeds)
- Grace Period/ Pre-payment Penalty/ Rebates: No grace period on principal; No pre-payment penalty; Simultaneous payment of principal and interest; No rebates
- Penalty Fee for Late Payment: 0.5% per month
- No Collateral Requirement
- Manner of Loan Release: Via bank or check
- Schedule of Loan Release:
- Advance drawdown (loan amount not yet secured by sub-PN of end- borrowers) depending on financial profile of the MFI but not to exceed 50% of the approved loan amount at any point
LOAN FEATURES: CONDUIT TO MICRO ENTERPRISE BORROWER
- Loan Limit: Up to P100T to end-borrower; may be increased up to P200T for micro end-borrowers with at least one (1) full time worker
- Manner of Loan Release/ Schedule of Loan Release/ Repayment Term/ Tenor/Collection System: Conduit free to determine
- Interest Rate and Service Fees: Up to 2.5% per month all-in
ENTERPRISE REHABILITATION FACILITY (ERF) FOR MICROENTERPRISESFacility under the P3 program that covers all natural and man-made calamities that adversely affect microbusinesses in vulnerable areas. This will be a quick response for efficient mobilization of loan funds for immediate recovery and rehabilitation of microenterprises in the event of natural disasters.
COVERAGE
- Disasters brought about by the following natural calamities- typhoon, earthquake, volcanic eruption, flood, tsunami, tornado, drought and other effects of climate change
- Man-made disasters- fire, war, and terrorism
- Areas and sectors to be financed must be declared under the state of calamity or reported by the NDRRMC to be severely devastated
APPLICABLE LOAN GUIDELINES
Existing lending guidelines under the P3 retail lending shall apply with the following . However, since this loan facility aims to provide immediate relief to rehabilitate affected MEs, special loan terms will be implemented as follows:
ELIGIBILITY CRITERIA
- should have an ongoing registered business or livelihood activities for at least one year prior to the calamity, and that the business was severely damaged by the disaster
- may be a start-up business for victims of war or terrorism and those who are displaced by the disaster, and have either relocate their business or start a new business venture
- loan applicant’s regular membership with a credit delivery partner Coop is not required
LOAN PURPOSE
- purchase of assets that will produce sales/new inventories
- replacement for repair of fixed assets
- financing of restructured loans arising from the calamity
LOAN AMOUNT
Maximum of P200,000 by micro end-borrower subject on the following limits:
- up to P50,000 for first time borrower without PDC
- up to P200,000 for first time borrower with PDC
INTEREST RATE
- Up to 1.5% effective interest rate per month or 18% per annum (all inclusive)
- for loan applications financed through the CDP coops, the whole interest charges should will go to the coop as service fee
REPAYMENT TERMS
- payable up to 24 months, subject to monthly amortization
- grace period- after six months (for principal only)
Tel. Number: (632) 8 651-3333
Email: sbcorporation@sbcorp.gov.ph
Website: https://sbcorp.gov.ph/
Address: 17th & 18th Floors, 139 Corporate Center, Valero St., Salcedo Village, Makati City 1227 Philippines
Corporate Video
