The United Nations Development Programme (UNDP) and the Australian government are extending a P100 million worth of loans for social enterprises (SEs) in the Philippines.
The grant, which will be sourced from Australia’s Social Impact Fund (SIF), aims to assist around 40 social enterprises in the next five years.
“The project is designed to close gaps by providing selected, high-potential start-up SEs with funding and technical support to enable them to grow their operations and attract investments from global and local impact investors. It will support SEs that have a proven concept or ‘blueprint’ and a plan for growth with increased impact that is aligned with the Sustainable Development Goals [SDGs],” UNDP Philippines Country Director Titon Mitra said.
UNDP said a local bank will provide loans as financial assistance of up to $150,000 or around P7.5 million per social enterprises over three years.
The UN agency added that these loans will have a repayment period of five to six years based on current business lending rates.
In addition to funding support, international and Philippine experts will also provide technical assistance to help social enterprises to further develop their business models and expand operations.
“The Australian Government encourages the development of innovative social enterprises in the Philippines as a pathway to economic growth. This project is among the exciting aid investments Australia is supporting as part of our new approach to development cooperation. We are investing more in innovative programs that offer science and technology-based solutions to address some of the most pressing social and environmental issues, reach underserved communities and contribute to the SDGs,” Australian Embassy Deputy Head of Mission Mat Kimberley said.
The SIF in the Philippines is aligned with and supports the broader initiative of UNDP to encourage increase in private investments to sustainable development and help achieve the SDGs.
UNDP in the Asia Pacific, through its regional SIF, has been engaging financial and social capital stakeholders to create or expand socially responsible businesses, especially growing, small and medium-sized enterprises.