The Industrial Guarantee and Loan Fund (IGLF), managed by the Development Bank of the Philippines (DBP), capped 2016 on a high note with P4.5-billion loans released to micro, small and medium enterprises (MSMEs), surpassing the P4.1-billion year-end target, while loans approved reached P4.6-billion. Short-term loans to small borrowers accounted for 76% of total releases and approvals.
As of end-December 2016, IGLF’s total loan portfolio reached P5.6-billion, up by P1.1-billion or 24% from the previous year’s P4.5 billion.
Wholesale lending to DBP-accredited participating financial institutions led the aggressive fund mobilization with conduits relending to MSMEs engaged in various economic activities such as hog farming, duck and poultry raising, retail sale of various items, and tricycles and other land transport operations. The other loan growth came from retail lending thru DBP’s Small and Medium Investment Loans for Entrepreneurs and different DBP branches in the countryside directly benefitting small businesses, involved in agribusiness, private education services, health care, tourism, food manufacturing and trading.
IGLF, a fund owned by the Republic of the Philippines represented by the National Economic and Development Authority, is the longest running lending facility in the country that gives strong support to empower MSMEs by giving increased access to credit. It aims to boost the Duterte administration’s thrust of continued growth momentum of MSMEs in the regional and rural areas.
IGLF has continuously been searching for ways to expand its credit service to small borrowers that have significant impact on employment, income generation, and value-adding to indigenous resources, and that contribute to community welfare and development.
Meanwhile, in addition to its loan releases, IGLF has also been a main contributor to the Credit Surety Fund program approved by the Bangko Sentral ng Pilipinas.
IGLF’s performance continues to indicate favourable management of resources. It has paid out almost all its foreign obligations to the World Bank, and with only the Asian Development Bank having a remaining balance of P305-million. IGLF ended 2016 with a P104-million projected net income.
IGLF has grown the National Government’s initial investment of P803-million to P6.8-billion.