Loan terms for tourism businesses eased — DOT

Published June 10, 2021, 4:18 PM

by Alexandria Dennise San Juan

The Department of Tourism (DOT) is urging more tourism enterprises to take advantage of the business loans being offered under the government’s pandemic recovery program to help them survive the health crisis.

(File photo / MANILA BULLETIN)

This, after the government extended to two years the grace period for repayment of the business loans to distressed tourism enterprises under the “Bayanihan 2” Act.

According to the DOT, the terms of the interest-free soft loans have been relaxed even more to encourage more micro, small and medium enterprises (MSMEs) in the tourism industry to avail themselves of the loan facility managed by the Small Business Corp. (SB Corp) of the Department of Trade and Industry (DTI).

The relaxed terms also allow for a second round of loans for employee retention and a maximum loanable amount of P5 million.

Tourism Secretary Bernadette Romulo-Puyat thanked the DTI and the SB Corp for implementing these adjustments, which she said will help tourism businesses recover amid the ongoing coronavirus disease (COVID-19) pandemic.

“While we see the vaccination of tourism workers as the light at the end of the tunnel for the industry, we also know that tourism businesses still badly need the government’s support to get by in the coming months as we wait for vaccine doses to arrive,” Puyat explained.

In a recent letter to the Tourism Congress of the Philippines (TCP), the SB Corp said it had approved the extension of the grace period for loan payments from one to two years for tourism MSMEs accredited by the DOT or registered by the Barangay Micro Business Enterprises (BMBE).

To help tourism enterprises maintain their operations and retain their employees, the SB Corp also increased the loanable amount relative to the enterprise’s financial details.

Under the amended guidelines, the loan amount shall not exceed 15 percent of annual sales of the business or 20 percent of asset size, whichever is higher—and not lower—as previously required by SB Corp.

The figures will also be based on the financial statements for 2018 or 2019 filed with the Bureau of Internal Revenue (BIR), it added.

Meanwhile, the maximum loanable amount for applicants with BIR-filed financial statements remains at P5 million for medium enterprises, P3 million for small enterprises, and P300,000 for micro-enterprises.

Businesses with existing loans under the Bayanihan CARES program may also reapply for a second round of loan for employee retention, provided that the applicants with existing loans under the program will not exceed the maximum loanable amount and that their BIR-filed financial statements support a higher loan amount.