For the third time since 2018, the Department of Trade and Industry (DTI) and First Circle renewed their partnership to foster competitiveness and growth in the Small and Medium Enterprises (SMEs) sector.
The renewed Memorandum of Understanding (MOU) was signed during a ceremonial event held at the DTI-Board of Investments Building in Makati last 13 July 2023. This was led by DTI Secretary Fred Pascual and First Circle General Manager and Head of Finance Rhys McCoy. Also in attendance were DTI Undersecretary Kim Bernardo-Lokin, DTI Undersecretary Blesila Lantayona, and Bureau of Small and Medium Enterprise Development (BSMED) Director Emma Asusano.
From 2018 to 2023, First Circle has disbursed a total of ₱8.5 billion in business loans to over 3,450 businesses. 1,743 of these SMEs borrowed during the pandemic period — providing much-needed support during the harsh economic environment brought by the COVID-19, global supply chain issues, and inflation.
First Circle’s flagship product, the Revolving Credit Line, is a non-collateral and free-to-open business credit line that requires no commitment to use. Clients only pay when they use the credit line, and each client is assigned a dedicated account manager who helps with everything from collecting application requirements to loan repayment. With First Circle’s proprietary underwriting processes, SMEs can get up to ₱20 million in financing for as low as 0.99% monthly interest.
First Circle's credit line is open even to new businesses, which means that SMEs operating for one year or less will have fewer financial barriers to overcome. “Evaluating SMEs based on their operational age rather than merit will only push them to borrow from predatory lenders,” says First Circle Head of Acquisitions Alan Smyth. “With First Circle, any business owner qualifies for a credit line as long as they have an annual business revenue of at least ₱5 million, is a bona fide Philippine resident, and has their business registered with BIR and DTI or SEC.”
The partnership renewal is timely since the Regional Comprehensive Economic Partnership (RCEP) Agreement – a landmark agreement among 15 Asia-Pacific countries – came into force for the Philippines last June 2. Its preferential trading and investment agreements between member nations provides local SMEs unprecedented access to a combined market of 2.3 billion consumers by reducing tariffs and trade barriers on certain products and services.
“It opens up the door for our MSMEs to participate in a global setting," says DTI Undersecretary for Communications Kim B. Lokin. "Now, they will have the ability, the chance to showcase their products, goods, and services to a much wider range. We want to give our MSMEs a push to become global.”
“RCEP opens up opportunities for our MSMEs to take advantage of a bigger market, explore a much expanded supply chain, and avail of new and better technologies to help innovate their business processes", adds DTI Undersecretary for Regional Operations Group (ROG) Blesila A. Lantayona. "DTI will intensify its information campaign in the regions and provinces through roadshows and dissemination of primers and other info materials to help MSMEs prepare for global opportunities. MSMEs need support in the areas of financing, market access, and on how to fully embrace the digital technology," Undersecretary Lantayona further says.
DTI is rolling out a series of countryside roadshows and primers in the next few months to prepare entrepreneurs for global opportunities. “There is really a need for us to push MSMEs in terms of financing, market access, and taking advantage of digital technology,” Undersecretary Lantayona further says.
Despite these empowerment activities, DTI admits that MSMEs’ first step to becoming global – finding financing – remains one of their biggest challenges. This is where First Circle pledged their assistance.
“With the renewal of our strategic partnership from 2023 to 2025, we can better support DTI’s efforts to enable SME participation in the global supply chain,” says First Circle General Manager and Head of Finance Rhys McCoy. “Beyond equipping entrepreneurs with sustainable financial resources, First Circle will ramp up its efforts to provide the financial literacy and business knowledge that SMEs need to navigate the complexities of the global economy.”
First Circle is a financial technology company that has empowered thousands of SMEs since 2016 through accessible financing and free growth tools. For more information about the company, visit www.firstcircle.ph.