Philippine financial tech company First Circle has debuted its new revolving credit line service in the hopes of helping out 10,000 struggling micro, small, and medium enterprises (MSMEs) in the country during the pandemic.
The five-year-old company says this will enable MSMEs to avail of funds that they can utilize to support their businesses during the current health crisis.
The service works similar to a credit card where users can borrow funds up to a set limit.
According to the company, a lot of businesses often miss out on such opportunities, specifically because they lack formal documentation and the collateral banks need for such loans.
However, in a statement, First Circle VP for External Relations Benedict Carandang said they’re veering away from traditional methods of documentation and collateral to assess the “creditworthiness” of a business.
“This challenge in financial inclusion inspired and pushed the team to innovate and find ways to deliver financial inclusion to those who need it the most using technology,” he said.
First Circle says they’ll be offering up to P5 million in a credit line to businesses that will be approved for the program. They note that proprietors can access the money anytime for a term of six months.
The Philippine-based fintech company has allotted P3 billion to their revolving credit line program.
Since partnering with the Department of Trade and Industry (DTI) in 2018, They’ve provided P4.5 billion in loans to 6,000 medium and small-time businesses.
In 2020, First Circle was named among the most inclusive startups globally in the 2020 Cohort Inclusive Fintech 50. They were the only Philippine company to be included in the list.
Aside from this, the company was a finalist in the LBC Business Solutions SME Company of the Year at the Asia CEO Awards in 2020.
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