MANILA – Philippine-based financial technology firm First Circle has partnered with the Department of Trade and Industry (DTI) to extend a PHP1.5-billion credit facility to small and medium enterprises (SMEs) in the country.
On Wednesday, Trade Secretary Ramon Lopez, Small Business (SB) Corp. President Luna Cacanando, and First Circle Co-Founder and Chief Executive Officer Patrick Lynch signed a memorandum of understanding (MOU) to get the SME loan program underway.
Under the MOU, First Circle will make its financial products and services available in more than 900 DTI Negosyo Centers nationwide. “We will be able to reach more business than ever before, and we will be able to increase the size of the credit limits available to the strongest businesses,” Lynch said.
This credit facility will be a non-collateral business loan for small-scale businesses, he added. “We have had large demand from business owners across the country who have been asking us when we would be available nationwide. We’re delighted to be able to extend our service to SMEs all over the Philippines,” Lynch said.
The trade chief welcomed First Circle’s business model, which is almost akin to the government’s own microfinance program Pondo Pagbabago at Pag-asenso or the P3 Program. Under the P3 Program, the government provides loans to small-scale businesses with interest rate not exceeding 2.5 percent and with no collateral.
First Circle’s SME loan has an interest rate ranging from 1.99 percent to 2.49 percent on top of a 1.99-percent processing fee.
First Circle co-founder Tony Ennis said the fintech firm aims to further fast-track the release of its credit facilities, provide flexible terms for SMEs, and expand its coverage and availability. (PNA)