Asialink Finance Corp. yesterday said non-bank financial institutions (NBFIs) continue to play a big role in granting access to funds to micro, small and medium enterprises (MSMEs).
In a statement, Asialink said NBFIs account for nearly half of loans extended each year to the country’s MSMEs.
Citing latest available data from the Asian Development Bank (ADB), Asialink said loans to MSMEs by microloan organizations, pawnshops and other NBFIs topped $4.9 billion in 2020.
By comparison, banks lent around $10.3 billion to this sector. The amount, though, comprised just 2.4 per cent of all loans they extended to all their borrowers.
“MSMEs remain underserved by banks. The huge gap is being bridged by NBFIs”, said Robert Jordan Jr. , chief executive officer of Asialink.
The gap is even more glaring considering MSMEs — which number around 996,000 as of 2020 — make up over 99 per cent of total businesses in the Philippines, Jordan added.
The ADB data showed among Southeast Asia’s largest economies, the Philippines has the least funding support for MSMEs in terms of bank loans.
Thailand’s banks extended over $168 billion to support MSMEs in 2020, while those in Singapore, Malaysia and Indonesia lent from $68 billion to $79 billion.
NBFI loans to MSMEs in the Philippines were the fourth largest in the region.
Jordan said the presence of NBFIs allowed MSMEs to weather the effects of the pandemic.
Jordan said Asialink in 2022 released P10.5 billion in total loans, a 25 percent increase compared to 2021 performance, to about 24,000 clients nationwide which are 70 percent MSMEs.
Asialink has been serving a larger share of the market even as it continues to help its core clients — the unbanked and underserved sector, he said.
Asialink was formed in June 1997, with a capitalization of just P3 million. Today, it has over 800 employees, thousands of independent loan consultants and partner dealers, and more than 100 branches nationwide.
The company has lately been focusing on MSMEs who need loans using their used vehicles as collateral. Irma Isip
