THE Department of Trade and Industry (DTI) remains confident that more tourism stakeholders will be able to tap the funds made available to them under the Bayanihan 2 Law for their working capital.
In a Viber message to the BusinessMirror, Trade Secretary Ramon M. Lopez remains convinced that the loan processing guidelines of the P6-billion CARES for Travel program of the Small Business Guarantee Corp. (SB Corp.) don’t need to be revised. “The capacity to process loans is high. That’s why there’s no backlog.”
He added, “The guidelines are clear and application, processing and release are online and easy. No collateral. Done in four days if complete documents and max of around one week. Unless there are negative findings.”
Information provided by the Department of Tourism (DOT), however, showed that as of March 31, 2021, SB Corp. has approved P129.12 million in loans for 346 applicants. Of the approved applications, some P90.12 million was released to 260 tourism enterprises/loan applicants. The approved loan amounts, however, are just 2.1 percent of the P6-billion funds allocated for micro, small, and medium tourism stakeholders under Bayanihan 2.
The poor availment has pushed the Tourism Congress of the Philippines to write to the DOT and appeal for more relaxed and lenient guidelines so more tourism stakeholders will be encouraged to tap the SB Corp. funds. SB Corp. is under the DTI. (See, “Struggling tourism firms need higher working capital loans to recover,” in the BusinessMirror, April 8, 2021.)
But Lopez explained, “Of course the loan is dependent on the size of business and capacity to pay. Not only applied loan amount.” Under SB Corp. guidelines, loan applicants have to submit the financial statements they submitted to the Bureau of Internal Revenue, which stakeholders separately shared, are usually low since these are for tax purposes.
The DTI chief acknowledged that while the “tourism sector has a bigger [fund] allocation [under Bayanihan 2] . . . . not many yet are borrowing.” He stressed the funds are not going to waste, though. “Hindi sayang. Ongoing borrowings are taking place. More in due time.”
Meanwhile, the Department of Labor and Employment (DOLE) has been continuously relaxing its guidelines to accommodate more tourism workers in its cash assistance program, funded by P3 billion from the Bayanihan 2 Law.
As of February 5, close to 159,000 tourism workers from establishments, organizations, and associations nationwide have received P791 million in benefits from DOLE’s cash-for-work program implemented in partnership with the DOT. While still low, this is already equivalent to 26 percent of the total funds allocated for the program. Each beneficiary received P5,000 in cash aid.
To encourage more displaced tourism workers to access the cash aid, the DOT and DOLE expanded the fund coverage to include beneficiaries like island-hopping boat pilots, habal-habal drivers, food vendors and fast-food workers, massage therapists, salon workers, golf caddies and others working in tourism-focused destinations.