Retail Lending Features

Directory of Micro-Finance Conduits

PCFC Conduits by Provinces

Matrix of Lending Features:

	short-term loans	long-term loans
Loan Purpose	Export Financing (Export Packing Credit) Credit Line (Temporary Working Capital), preferably transactional)	a) Purchase of Equipment b) Building Construction Term Loans d) Permanent Working Capital
Target Industries	All industries except trading of imported goods, of liquor and cigarettes, and extractive industries. Each GFI shall have its own priority list as well as exclusion list which shall be prepared to ensure complementation of programs of the GFI's.	All industries except trading of imported goods, of liquor and cigarettes, and extractive industries. Each GFI shall have its own priority list as well as exclusion list which shall be prepared to ensure complementation of programs of the GFI's.
Eligible Enterprises	At least 60% Filipino-owned whose assets are not more than P100 million, excluding the value of the land, or subject to ownership rules as defined under existing Philippine laws for specific industries. Only SMEs with assets of at least P 500,000 are qualified.	At least 60% Filipino-owned whose assets are not more than P100 million, excluding the value of the land, or subject to ownership rules as defined under existing Philippine laws for specific industries. Only SMEs with assets of at least P 500,000 are qualified.
Minimum Financing	Subject to GFI's minimum loan requirement, which shall in no case exceed P1.0 million. The loan must be within the SME's absorptive capacity as evaluated by the GFI.	Subject to GFI's minimum loan requirement, which shall in no case exceed P1.0 million. The loan must be within the SME's absorptive capacity as evaluated by the GFI.
Maximum Financing	70% of the value of LC/PO; maximum of P5.0 Million. Subject to a GFI's minimim loan requirement which shall in no case exceed P1M. The loan must be within the SME's absorptive capacity as evaluated by he GFI.	80% of the incremental project cost; maximum of P5.0 Million. Subject to a GFI's minimum loan requirement which shall in no case be more than P1M. The loan must be within the SME's absorptive capacity as evaluated by the GFI.
Non-collateralized Premium	A risk premium of up to 1% p.a. may be added for loans not fully collateralized and 2% for loans with less than 50% collateral. The risk premium is added based on the collateral position of the borrower at the time of loan application approval.	A risk premium of 1% may be added for loans not fully collateralized and 2% for loans with less than 50% collateral. The risk premium is added based on the collateral position of the borrower at the time of loan application approval.
Repayment Term	Maximum of one year	Maximum of 5 years, inclusive of maximum 1 year grace period on principal monthly amortization
Collateral**	Registered/Unregistered Real Estate Mortgage/Chattel Mortgage Assignment of LC or PO (if applicable) Guarantee cover Corporate Guarantee (if franchisee) Assignment of lease rights (if franchisee) Other acceptable collaterals to GFIs	Registered/Unregistered Real Estate Mortgage/Chattel Mortgage Corporate Guarantee (if franchisee) Assignment Of lease rights (if franchisee) Other acceptable collaterals to GFIs
Evaluation and Service Fees	P2,000 for every 1 Million Plus front-end fee of 1/2 of 1% of approved loan. A service fee of 1% p.a. may be imposed if the GFI accommodates projects outside of its regular areas of geographical operation.	P2,000 for every 1 Million Plus front-end fee of 1/2 of 1% of approved loan. A service fee of up to 1% p.a. may be imposed if the GFI accommodates projects outside of its regular areas of geographical operation.
Borrower: Debt-Equity Ratio	At most 80:20 after the loan	At most 80:20 after the loan At most 70:30 (if franchisee)
Profitability	Positive income for last year (If past year's income is negative, the average income of past 2 or 3 years should be positive). It is implied that projects are operational for at least a year.	Positive income for last year. (If past year's income is negative, the average income of past 2 or 3 years should be positive). It is implied that projects are operational for at least a year.
Other Ratios	Based on Industry standards	Based on industry standards

**Collateral Policy
**The Program will not decline a loan only on the basis of inadequate collateral. However, the borrower must be willing to mortgage any available business and non-business related collateral, including assets to be acquired from the loan to secure the borrowing. The program shall adopt a differentiated minimum/partial collateral policy as dictated by loan purpose and loan amounts.
* Interest rates may be reviewed quarterly.

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