BSP raises ceiling on micro-credit

Business World - THE BANGKO Sentral ng Pilipinas (BSP) has raised the existing cap on microfinance loans to allow banks to provide more financing to clients.

In Circular No. 744 dated Dec. 28 and posted on its Web site yesterday, the BSP added “microenterprise loan plus” or “microfinance plus” to the types of microfinance loans that banks may extend to their clients.

Whereas microfinance loans are capped at P150,000, the microenterprise loan plus or microfinance plus are capped at double that or at P300,000.

“We created the microfinance plus concept in recognition of the success of a growing number of microenterpreneurs,” said BSP Deputy Gov. Nestor A. Espenilla, Jr. in a text message yesterday. “They need bigger loans.”

Pia Roman-Tayag of the BSP’s Inclusive Finance Advocacy Staff, said the P300,000 limit is still less than what traditional banks offer.

She said those who need the bigger loans have been “largely unserved.”