Last Updated on July 27, 2024 by admin
Have you ever wondered how an entrepreneur in the Philippines can get business loan? are you looking for Business Loans to start up your own business,additional capital, production increase, or operational expansion. You should consider getting business loan,financing option either from a bank, a private lender or from the government.
There’s No way we can keep this to ourselves.We found some interesting business loan we thought to share with you ranging from Credit Line,Secured Business Loans,Unsecured Business Loans and SME express loans.
What is a Business Loan?
A business loan is a form of financing provided by a financial institution or lender to a business entity for the purpose of supporting its operations, expansion, or investments. These loans enable businesses to access the capital needed to grow and thrive in a competitive marketplace. Business loans can come in various forms, such as term loans, lines of credit, equipment financing, and Small Business Administration (SBA) loans.
A business loan is debt that entrepreneur is obligated to repay according to the loan’s terms and conditions.However, Businesses have a variety of loan options to choose from.
Purposes of Business Loans:
- o cover day-to-day expenses like payroll, rent, and inventory.
- To purchase new equipment or machinery.
- To buy or renovate property for business use.
- To finance growth initiatives like opening new locations or expanding product lines.
- To consolidate or refinance existing business debt.
How to Get a Business Loan:
- Assess how much money you need and what you will use it for.
- Review the lender’s requirements, such as credit score, time in business, and annual revenue.
- Gather financial statements, tax returns, business plans, and other documents required by the lender.
- Compare loan offers from different lenders to find the best terms and interest rates.
- Submit your application and wait for approval
Questions to ask yourself before choosing any business loan :
Before choosing a business loan, it’s crucial to ask yourself several questions to ensure you make an informed decision that aligns with your business needs and financial situation:
Purpose and Need:
- Why do I need the loan? Clearly define the specific purpose of the loan. Is it for working capital, inventory purchase, equipment financing, expansion, or something else?
- How much do I need to borrow? Carefully estimate the amount required, ensuring it’s sufficient to meet your goals without overextending yourself financially.
- What is the expected return on investment (ROI)? Will the loan help generate enough revenue or profit to cover the repayment costs and interest?
Financial Health and Repayment:
- Can my business afford the loan? Assess your cash flow and profitability to determine if you can comfortably make the monthly payments.
- What are the repayment terms? Understand the loan duration, interest rates, fees, and any prepayment penalties.
- What is my business’s creditworthiness? Check your business credit score and history to understand your chances of approval and potential interest rates.
Loan Options and Lenders:
- What type of loan is best for my needs? Research different types of business loans (term loans, lines of credit, SBA loans, etc.) to find the most suitable one.
- Which lender offers the best terms? Compare interest rates, fees, repayment terms, and customer service from various lenders (banks, credit unions, online lenders).
- What is the lender’s reputation? Research the lender’s credibility, reliability, and customer satisfaction ratings.
Read: 10 Philippines Banks that offer Personal Loans with Lowest Interest Rate
How Do I Qualify for a Business Loan in Philippines
Financial lenders in Philippines have different eligibility criteria depending on whether you wish to get a business loan for a sole proprietorship, or for a corporation or a partnership.
1. Borrower Must be a Filipino citizen
2. Your age should be between 21 to 65 years before and maturity stage
3. Must meet a minimum annual gross sales
4.Good creditworthiness
5.Two copies of the valid ID of the owner or primary applicant (with photo)
6. DTI registration documents
7.An application form
8. A valid company permit
9. Business background/company profile
10. The latest Audited Financial Statements
11. Latest ITR (including BIR stamp) and Mayor’s Permit
Eligible Borrowers
. Single Proprietorship
. Partnership
. Corporation
Types of Business Loans in the Philippines
Secured Business loan
This type of business credit facility require security/collateral pledge usually valuable assets and items that your business owns before you can get access to the loan, which indicate that you assuring the lender of paying back the amount you borrow.
It generally have lower interest rates, longer loan terms, and higher loan amounts than unsecured loans because collateral reduces the risk for lenders
Unsecured Business Loans
In view, unsecured business loans aren’t backed up by any asset. That means there’s a higher risk for the lender ,so you’ll generally pay more interest with unsecured loans.
However, Lenders will need some confirmation that you are serious regarding your business loan which are normally backed up by a business’s trading position
Unsecured Business Loans tend to be for smaller amounts, and take place over a shorter period of time
Read: List of Best online Loan Apps registered in Philippines by securities and exchange commission
Credit Line
Credit Line is a flexible loan from a bank or financial institution. Similar to a credit card that offers you a limited amount of funds.It’s ideal for short-term, recurring, or working capital financing.
Credit Line can be use for the following purposes:
. Business opportunity: working capital for financing daily business operations
. Overdraft protection
. Emergency situations
. Projects with funding challenges
. Accounts receivable financing
Type banks in Philippines that offer Business loans
1. Metrobank
Metrobank Philippines is one of the banks which developed a loan product especially for SMEs.They offer three types of business loans which are SME Credit Line, SME Short-term Loan, and Long-term Loan. SME Credit Line is for people who want to increase their working capital or those who need funding for their daily business operations.
SME Credit Line
Metrobank Philippines SME Credit Line offer working capital for business with Minimum Credit Line – Php 1,000,000.00 and Maximum Credit Line – Php 20,000,000.00
SME Term Loan
This kind Metrobank loan is open for acquiring new equipment, business expansion, franchise financing, renovation of a commercial property. and loan take-out.It has Minimum Loanable Amount – Php 1,000,000.0 to Maximum Loanable Amount – Php 20,000,000.00
Interest rate of metrobank is competitive with Monthly or quarterly amortizations.It has Short-term: Up to 360 days and Long-term: 2 – 7 years
2 BPI Family Ka-Negosyo Business Loan
BPI Family Ka-Negosyo Loan is designed to support business expense.It offers SHORT-TERM FINANCING to cover for unplanned expenses or to bridge working capital requirements, and LONG-TERM FINANCING to modified work with your available funds and cash flow schedule.
BPI Family Ka-Negosyo long-term financing can help you with:
1. Business Expansion
2. Franchise Financing
3. Purchase of Fixed Assets and Equipment
4. Purchase / construction / renovation of condominium unit / residential property for lease
5. Purchase / construction / renovation of commercial property
6. Refinancing of existing commercial loan / mortgage
The lender also offers FRANCHISE FINANCING. BPI Family Ka-Negosyo Franchising Loan offers affordable financing to enable customer start their franchise business today.
Borrowers can borrow Minimum of PHP 500,000 and Maximum of 60% or 70% of appraised value of collateral with Monthly or quarterly amortizations. The loan tenor is from 1-0 years
3. Landbank Business loan
Landbank support entrepreneurs through its lending programs.Entrepreneurs are given the support they need to start or expand their existing business in all of the 81 provinces nationwide.
They offer term Loan Facility,Working Capital and Liquidity Support,Exporters Production Support Facilities,OFW Reintegration Program (OFW-RP),Farm Tourism Financing Program and Innovation and Technology along with different loan package.
4. BDO Business loan
BDO Loans help borrower fund their projects, expand of businesses, build offices,purchase of new asset like machinery and equipment’s as well fund the day-to-day needs of your company.
BDO Loans is offer as Project Finance Loan, Term Loan which is to be paid within 1-3 years, or long term, paid over 3 – 5 years.,SME Loan and Working Capital Loan used to fund day-to-day needs of your company.
5. PSBank Business loan
PSBank offers SME Term Loan with Prime Rebate and SME Business Credit Line.—-The PSBank SME Term Loan with Prime Rebate comes with a maturity of 1 year up to 7 years. Repayment is through amortization of principal and interest during the loan period.
PSBank Business Loan “SME Term Loan” application depends on certain factors like if you will be using a real estate property as a collateral or you’ll be doing it with a time deposit.
6. Pag IBIG Business loan
he Pag-IBIG Fund Multi-Purpose Loan or MPL Program is a cash loan that qualified members may secure to assist them with any immediate financial need.
With Pag-IBIG Fund’s MPL program, qualified members can borrow up to 80% of their total Pag-IBIG Regular Savings, which consist of their monthly contributions, their employer’s contributions, and accumulated dividends earned. If you have an outstanding Calamity Loan, the amount of loan you will receive shall be the difference between the 80% of your total Pag-IBIG Regular Savings and the outstanding balance of your Calamity Loan.
The MPL comes at a low interest rate of 10.5 percent per annum. You would be pleased to know that a significant part of the income derived by Pag-IBIG Fund from the loan program is returned to its members in the form of dividends.
The loan is payable within 24 months and comes with a deferred first payment. Formally-employed members shall pay their loan amortization through a salary deduction arrangement with their employer.
Self-employed individuals, Overseas Filipino Workers (OFWs), and all other individual payors may their amortization at any of our Pag-IBIG Fund branches.
How can I qualify for Pag IBIG Business loan?
To qualify for Pag IBIG Business loan, You must be an actively contributing member with at least twenty-four (24) monthly membership savings (MS) and sufficient proof of income to qualify. If you have If an existing Pag-IBIG Fund Housing Loan, MPL and/or Calamity Loan, your payments must be updated for you to qualify.
Also read: Banks and online lenders that offer Salary loan in Philippines
7. SSS Business Development Loan Facility
The Business Development Loan Facility is a lending facility of the Social Security System (SSS) designed to contribute to the nation’s economic growth and development by providing financial assistance to the business sector for the purpose of increasing productivity and enhancing potential earnings through expansion, diversification and other business development projects.
It also aims to support the government’s program of invigorating economic activity and providing more employment opportunities.
Eligible Borrowers
The eligible borrowers shall be new or existing private industries and enterprises including registered Barangay Micro Business Enterprises (BMBEs) with the following qualifications:
Single proprietorship, Partnership or Corporation, as least 60% Filipino owned, including cooperatives and non-governmental organizations;
Loan Purposes
The SSS Business Development Loan Facility may be used for the following purposes:
1.Site development;
2,Enhancement or modernization of existing facilities;
3,Construction or repair of building and other civil works;
4,Acquisition or repair/upgrading of machinery and equipment including furnishings;
5. Acquisition of existing facilities;
6. Acquisition of land (up to 50% of the acquisition cost); or
7. Working capital
How to Apply
To apply for SSS Business Development Loan Facility, SSS member-employers may avail of the loan facility through the SSS accredited participating financial institutions (PFIs) which will on-lend the fund to eligible borrowers for financing.
The loan application shall be filed with any of the SSS-accredited Participating Financial Institutions (PFIs). For the list of accredited PFIs, please contact the Business and Development Loans Department at telephone number 8920-6401 loc. 5115 or thru e-mail at bdld@sss.gov.ph.
LOAN ABLE AMOUNT
The maximum loanable amount shall be the lowest of the following, provided the borrower’s debt-equity ratio after financing shall not exceed 3:1 and that its total loan with the SSS shall not be more than five percent (5%) of the SSS Investment Reserve fund (IRF):
Amount of loan being applied;
Actual need of the borrower (total project cost)
Loan value of the assigned collateral or securities; or
Maximum of P500.0 million per borrower.
INTEREST RATE
The interest rate of the loan may be variable or fixed based on the prevailing SSS pass-on rate to PFI plus PFI’s spread. The prevailing interest rates shall be reviewed monthly.
TERM OF THE LOAN
The loan shall be payable monthly, quarterly, semi-annually or annually based on the PFI’s approved amortization schedule and shall have a maximum term of fifteen (15) years with a three (3) year grace period on principal payment.
The loan with a term of more than fifteen (15) years and a grace period of more than three (3) years may be allowed for loans to be used to finance projects in extractive industries and forest development related projects including those with exceptional cases that require longer tenor, provided, the term will not exceed twenty-five (25) years.
ACCEPTABLE COLLATERAL’S
The loan shall be secured by any collateral acceptable both to the PFIs and the SSS provided the loan is fully secured.
PREPAYMENT PENALTY
No pre-termination fee/penalty shall be charged in case of pre-payment of loan.
For more information, please visit the Business and Development Loans Department, 5th Floor, SSS Main Building, East Ave., Diliman, Quezon City or you may call telephone number 8920-6401 local 5115, 5954, or 5955 or e-mail us at bdld@sss
8. Security bank Business loan
Security bank offer SME Business Express Loan perfect for businesses looking to finance short term needs—whether it’s equipment, office spaces, or cash for day-to-day operations. With minimal documentary requirements, fast approval and auto-crediting of funds, Security Bank SME Business Loan is tailor-fit to the growing needs of your business.
The MINIMUM LOAN AMOUNT is PHP 1,000,000 and MAXIMUM LOAN AMOUNT PHP 5,000,000 with loan tenor of 12, 18, 24, or 36 months
Why Get security bank SME Business Express Loan?
1. No collateral required for loans up to P5,000,000
2. Minimal application requirements – no application fee required!
3.Enjoy seamless processing & approval in as fast as 5 days!
4. Loan proceeds are auto-credited upon disbursement of funds.
FEES AND CHARGES for security bank SME Business Express Loan
1. Processing fee PHP 3,000
2. Notarial fee for Sole Proprietorships PHP 400
3. Notarial fee for Partnerships and Corporations PHP 800
4. DST Approved Loan Amount / 200 * 1.50
5. Late Payment Fee
6. 3% of past-due amount for the month
7. Effective September 10, 2021: 3% of unpaid amortization
9. Maybank business loan
Maybank Philippines offer SME Clean Loan / Financing –i which helps Boost your company’s working capital with fast Cash and no collateral required. Available for online application to both Maybank and non-Maybank customers.
Eligibility for Maybank business loan
Open to both Maybank and non-Maybank customers who are Sole Proprietors, Partnerships or Private Limited companies (Sdn. Bhd.) with:
1. Below RM25million annual sales turnover
2. Below RM5 million outstanding loan/financing with Maybank
3. Malaysian-owned registered company
4. More than 1 year in operation
Financing Facility
1. Term loan or Commodity Murabahah Term Financing-i (CMTF-i)
2. Financing amount: RM10,000 to RM1,500,000 (up to RM250,000 for online application)
3. Repayment tenure: up to 7 years (up to 5 years for online application)
4. No collateral required
10. PNB in the Philippines Business loans
PNB in the Philippines offers SMALL BUSINESS LOAN PROGRAM To finance long term credit to buy new equipment or finance your expansion.
PNB loan comprises of Long-Term Loans,Short-Term Loans, credit Line ,Trade Services and small business loan
The PNB in the Philippines small Business loan have the following features
1. To finance business expenditures or expansion
2. Eligible borrowers: those engaged in light manufacturing, processing, services and retail/wholesale trade
3. Favorable track record/experience and credit standing for the past three (3) years
4. Minimum of P1.0 Million up to P10 Million loanable amount
5. Term Loans (TL) and Domestic Bills Purchase Line (DBPL)
6. Minimum tenor of one (1) year to maximum of five (5) years
You can also get Business loan from the following Philippines banks
1. RCBC bankard online
2. Producers Bank
3. AUB
4. DBP bank branches near me, contact number
5.AFPSLAI
6. QCRB
7.Citibank in the Philippines branches
8. Philippine Savings Bank
9. Card SME Bank in the Philippines
10. Mindanao Consolidated Cooperative Bank in the Philippines
11. CTBC bank hours and bank near me
12. BHF Rural Bank, Inc.
13. Luzon Development Bank
14. Rural Bank of Barili
15. UCPB interest rate and requirements
16.RBT bank
17.Laguna Prestige Banking Corporation
18. Rural Bank of Rosario
19. Rural Bank of Mabalacat
20. Enterprise Bank
21. Entrepreneur Rural Bank, Inc.
22. UOB
23. Rural Bank of Bayombong
24. AllBank in the Philippines
25. Rural bank of Central Pangasinan
26. Bank of Communications
27. Malayan Bank in the Philippines
28. ISLA bank
29. QueenBank
30. BOF
31. Bank of Commerce
32. Mufg Bank
33. Standard Chartered Bank
Cooperatives that gives business loan in Philippines
1. Paglaum Multi-Purpose Cooperative
2. Gata Daku Multi-Purpose Cooperative
3. San Jose Koop
4. DCCCO Multipurpose Cooperative
5. Holy Cross Credit Cooperative
6. Magsaysay Multi-Purpose Cooperative
7. NEC Multi-Purpose Cooperative
Investment Companies that gives business loan in Philippines
Small Business Corporation
Online payday loans Companies that gives business loan in Philippines
1.Easycash
2.Global Dominion Financing Incorporate in the Philippines
3.Fuse lending credit requirements and rates
4.Radiowealth Finance Corporation in the Philippines
5.Esquire Financing
6.First Circle
7.P2P platforms
8.LEND
9.Pawn Shops nearby
10.Fuse lending credit requirements and rates
11.Vidalia
