First Circle, a Philippines-based financial technology platform, celebrates five years of supporting the country’s micro, small and medium enterprises sector with the launch of a groundbreaking revolving credit line to support at least 10,000 MSMEs nationwide amid the COVID-19 pandemic.
Previously only accessible to large companies, a revolving credit line is a business need that is unfortunately out of reach for 99.6 percent of businesses nationwide because of how they are not able to meet the formal documentation and collateral requirements of local banks.
“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,” said First Circle vice president for external relations Benedict Carandang.
The company utilizes alternative data sources that feed into an advanced proprietary underwriting system to assess the creditworthiness of borrowers in just a few days, compared to weeks or months by incumbents.
With First Circle, B2B companies that were previously underbanked are now empowered with up to P5 million in credit line, and they are able to draw down from anytime for a term of up to 6 months in case their business demand calls for it.
Government leaders and ministers, including the Department of Trade and Industry, Securities and Exchange Commission, Credit Information Corp., among others, expressed excitement and support for the trailblazing innovation that will change the game for the country’s economic growth and boost economic recovery from the pandemic.
“The focus of First Circle is supporting and financing the country’s SME sector, which plays a vital role in the continued development and growth of national economy, is admirable and deeply appreciated,” former Ambassador to UK and Ireland Jesus Tambunting said in a video message.
First Circle was recently named as one of the inclusive startups globally in the 2020 Cohort Inclusive Fintech 50. It was the only company from the Philippines selected from over 400 fintech firms from 111 countries.
The firm was recognized for its impact on unserved and underserved businesses and individuals even before the COVID-19 pandemic.
Since it signed its first memorandum of understanding with DTI in 2018, the finance firm extended borrowings to 6,000 SMEs and disbursed over 16,000 loans.
First Circle has provided P4.5 billion worth of loans to the MSME sector since then.