DTI Renews MSME Financing Partnership with First Circle Through 2028

The Department of Trade and Industry (DTI) said it renewed its partnership with online lending firm First Circle Growth Finance Corp. (First Circle) to fund micro, small and medium enterprises (MSMEs) through 2028. This marks the fourth renewal of the company’s partnership with the DTI since their collaboration began in 2018, First Circle said in a statement on Monday. First Circle is a partner of the International Finance Corp. to securitize up to $110 million, and holds an Asia United Bank credit line for P2 billion. The company in May also obtained a P300-million sustainable finance credit facility from Taiwan’s Cathay United Bank (CUB) to expand SME lending. “Together, these facilities channel a substantial pipeline of new capital toward underserved SMEs poised to benefit from deepening ASEAN integration,” First Circle said. Trade Undersecretary Blesila A. Lantayona noted that fintech lenders help address the limits of traditional lenders, which typically require a credit history and impose collateral requirements. About 99% of Philippine businesses are MSMEs, but financing remains a key challenge to their expansion. SME credit penetration is among the lowest in the region, First Circle said. “As we renew this collaboration for the fourth time, we recognize its growing contribution not only to the Philippine MSME sector, but also to the broader ASEAN (Association of Southeast Asian Nations) vision of fostering a more innovative, competitive, and inclusive regional economy,” Ms. Lantayona said. The renewed partnership also seeks to boost financial inclusion, accelerate digital transformation, and enable MSMEs to participate in regional and global value chains, First Circle said. The company has disbursed about P25 billion to Philippine SMEs, with about two-thirds of these firms first-time recipients of formal credit. — Beatriz Marie D. Cruz