Pioneering Program Helps Philippine SMEs Improve Credit Rating and Get Access to Financing

Lia Francisco, Founder and CEO of CreditBPO, has spoken with The Prospect Group about the CreditBPO Rating Report and increasing access to bank loans and financing for the 800,000 Small to Medium Size Enterprises (SMEs) in the Philippines.

Jul 06, 2015, 15:09 ET from The Prospect Group

MANILA, Philippines, July 6, 2015 /PRNewswire/ -- Lia Francisco, Founder and CEO of CreditBPO, recently spoke with The Prospect Group on the topic of financing for small and medium sized entities (SMEs) in the Philippines. The interview focused on the vision of CreditBPO, the financing environment for SMEs, and the pioneering program helping businesses boost their credit-worthiness that has been launched in the Philippines.

The first-of-its-kind program focuses on establishing the financial credentials of SMEs through a system called the CreditBPO Rating Report.

Francisco noted that access to credit, bank loans and other forms of financing are critical for the success of SMEs all across the country. However, many SMEs are having trouble attaining financing because of asymmetrical information barriers, relating to their operations. More specifically, the information banks need to make sound financing decisions is often not available.

The challenges faced by SMEs is illustrated by the number of businesses that have currently received financing. According to Francisco, "Several studies have been made showing that, really, SMEs have very little access to financing. Only about 10% are banked. So what we're trying to do is put forward a real solution for the 800,000 or so SMEs here in the Philippines."

By making SMEs aware of their credit profile and credit rating risk, along with activities that impact their overall credit, CreditBPO is making it possible for SMEs to overcome challenges in the lending sector. In particular, CreditBPO is helping SMEs understand the importance of keeping financial records and providing financial statements to potential lenders. 

The CreditBPO SME Rating dashboard is helping business owners understand the metrics they need to monitor, if they're going to be financed. There are also government programs and foundations dedicated to getting SMEs the money they need to thrive. CreditBPO is working with these programs and foundations to help improve the availability of financing. However, there are still significant challenges to be overcome in the near-term future.

CreditBPO is leveraging information technology to help SMEs meet their operating objectives, improve their visibility and enhance their credit worthiness. By doing this, the company is helping SMEs throughout the Philippines take their businesses to the next level of growth and making the dream of financing possible.  

The growth of the SME sector has lagged behind the overall national GDP growth in the Philippines--3% in the SME sector versus 6-7% in the overall GDP, said Francisco, who put together the CreditBPO initiative based on her experience as both a banker and a business owner.

Increased lending to SMEs is part of the national agenda---in the government's Philippine Development Plan. But the loan programs available are not being used because of the dearth of credit-related information SMEs supply. Keeping accurate financial records, for instance, is not a widespread practice among SMEs.

There has to be a quantum leap supplying reliable credit information and that's what CreditBPO can do, said Francisco, adding, "CreditBPO is really a pioneering effort; it's first to market."

Beyond the Philippines the business model is replicable in other emerging economies. "The solution that CreditBPO offers is not only going to address the SME credit access situation in the Philippines, but also those of SMEs in other emerging economies precisely because the credit information infrastructure have very common traits," said Francisco.

To watch the full length video interview, visit The Prospect Group's website:

About CreditBPO

CreditBPO was founded by former banker and business owner, Lia Francisco, with the goal of leveraging information technology to improve the visibility, operational efficiency, and credit worthiness of SMEs in the Philippines. For more information, please visit:

About The Prospect Group

The Prospect Group is a global media content provider that produces and distributes high-quality online video content specifically targeted to the international business community. For more information, please visit:

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SOURCE The Prospect Group