The Department of Trade and Industry will relax the collateral requirement on microbusinesses and small and medium enterprises (SMEs) for the P20 billion and P30 billion worth of loans and guarantee that the government plans to provide to this sector.
Trade and Industry Secretary Manuel A. Roxas II said that under the proposed SME Unified Lending Program for National Growth or Sulong, borrowers would be granted loans even if they would not meet the minimum 20 per cent collateral requirement imposed by banks.
Roxas said the Sulong program would accept other alternative business and personal collateral such as the assets to be acquired using the loan; the borrower's life insurance, and for franchisees, the corporate guarantee and assignment of lease rights.
