Baguio City Government offers Loan Package for Small Businesses

The City Government of Baguio releases a Stimulus Package guidelines and qualifications for micro and small enterprises in Baguio City in partnership with the Small Business Corporation in having a “2020 Baguio Revitalization Actions for a Vibrant Economy – Baguio Economic Stimulus Package (BRAVE -ESP).”

STIMULUS PACKAGE GENERAL GUIDELINES:

A. Eligible Projects:

All types of projects of a qualified micro and small enterprises affected by the community quarantine – both general and enhanced – declarations shall be eligible for financing, except those undertaken for unlawful purposes.

B. Classification of Enterprises:

Enterprise Gross Receipts for Micro Enterprise must be up to PHP 3,000,000 and for Small Enterprise up to PHP 3,000,001 to PHP 15,000,000.

C. Loanable Amount:

The loanable amount ranges from a minimum of Ten Thousand Pesos (PHP 10,000.00) up to a maximum of One Hundred Thousand Pesos (PhP100,000.00).

Micro Enterprises:

• Minimum loanable amount is Ten Thousand Pesos (PHP 10,000.00) with a maximum of Fifty Thousand Pesos (PHP 50,000.00).

Small Enterprise

• Minimum loanable amount is Ten Thousand Pesos (PHP 10,000.00) up to a maximum of One Hundred Thousand pesos (PhP100,000.00).

D. Purpose of Loan:

For WORKING CAPITAL REPLACEMENT, to ensure liquidity of firms:

1. Payment of non-deferrable and/or fixed operating costs incurred, such as payroll, rent, utilities and fixed- asset loans
2. Replacement of inventories damaged or consumed during the community quarantine period
3. Financing of capital expenditures such as equipment

E. Qualified Borrowers/Eligibility Requirements:

1. One hundred percent (100%) Filipino-owned micro or small enterprises.
2.  Legitimately operating for at least one (1) year immediately prior to 16 March 2020 and affected by the imposition of ECQ including similar community quarantine declarations.
3. Gross receipts of up to P15.0 million pesos.
4. Business located in Baguio City
5. MSMEs who have not availed of similar packages from other government institutions.
6. Favorable NFIS/Credit checking result.

Note: A co-maker/co-borrower shall be required if the borrower is 60 years old and above. An immediate family member/relative with source of income shall be required.

F. Interest Rate, Service Fee and Penalty Rate:

• Interest rate is 0% but has a Service Fee of 6% to 8%.
  – Loans payable for 12 months (exclusive of grace period) shall have a six percent (6%) service charge
  – Loans payable for more than 12 months (exclusive of grace period) shall have an eight percent (8%) service charge
  – The service fee shall be deducted from the borrowers’ loan
• A monthly penalty rate of 0.5% on the outstanding balance shall apply for borrowers who fail to pay their monthly amortization.
• There is NO COLLATERAL required under the program.

G. Payment Terms and Grace Period:

The loan repayment term shall be for a minimum of six (6) months up to a maximum of 24 months (exclusive of grace period), subject to regular monthly amortizations.

Loanable Amount Maximum Loan Payment Term:

• Loans fifty thousand pesos (PhP50,000.00) and below shall be payable for up to 12 months (exclusive of grace period).
• Loans above fifty thousand pesos (PhP50,000.00) shall be payable for up to 24 months (exclusive of grace period).

The loan shall have a maximum grace period of six (6) months.

Note: In case of death of borrower the City will recover from the estate of the deceased.

H. Mode of Release:

The loan shall be released in lump sum from the City Treasurer’s Office.

I. Documentary Requirements:

Here are the mandatory requirements during loan application:

• For all borrowers:

1. Fully accomplished Application Form and Signature Card
   – Available at the City Treasury Office
2. Photocopy of one (1) Government-issued ID with picture and signature
3. Two (2) Passport Size ID Picture.
4. Baguio City Mayor’s Permit (Renewal)
5. One (1) year Sales Records
6. Proof of permanent business address (Business Permit may be used as proof)
7. Photo of business site with borrower
8. DTI Business registration
9. Certificate of good standing in the community as certified by the barangay

• For co-maker/co-borrower:

  1. Fully accomplished Application Form and Signature Card

  2. Photocopy of one (1) Government-issued ID with picture and signature
  3. Certificate of good standing in the community as certified by the barangay

J. Mandatory requirements during loan evaluation:

The following are mandatory requirements for all borrowers:

1. Negative File Information System
2. Credit Checking for Qualified MICRO and SMALL ENTERPRISES (Loans from 10k to 100k)

K. Where to submit Loan Applications:

Submission of Loan Application will start tomorrow, July 1, 2020 at Baguio City Treasurer’s Office said by City Treasurer Alex Cabarrubias on the Public Information Office – Baguio City live this June 30, 2020.

Applications shall be numbered for tracking purposes and first-come-first-served basis.

Note: The physical presence of the borrower is required. Incomplete Documents will not be accepted. Applicants shall be informed of the Status of their applications through email or text message.

L. Loan Approval:

The City Treasurer’s Office and Permits and Licensing Division of the City Mayor’s Office to pre-screen/pre-qualify applications (per priority sector) before transmitting to the Small Business Corporation.

Since the City cannot accommodate all MSMEs, the City shall identify the sectors most affected by the COVID19 pandemic. The sectors identified shall be the ones prioritized.

Permits and Licensing Division and the City Treasury Office to identify the sectors to be prioritized. Wherein Small Business Corporation will be evaluated, processed and recommended approval of applications based on the guidelines set by the City. Then the City Government to do the final approval of applications upon recommendation of SBC.

For inquiries or clarifications

For inquiries or clarifications, kindly call 442-8931.

Source: Public Information Office – City of Baguio