Is RCBC Savings Bank's My Biz Loan Simple Enough for Pinoys?
RCBC Savings Bank’s My Biz Loan is an SME loan giving entrepreneurs three loan options depending on their preferences and purpose. These short-term secured loans address Filipinos’ usual small and medium business needs.
RCBC Savings Bank’s My Biz Loan
RCBC offers SME loans with a minimum amount of a P1million. Meanwhile, the maximum loan amount is 60% of the collateral’s appraised value (AV). Why? Since these loans are secured loans.
An individual client must be a Filipino citizen of legal age. However, the borrower must not be older than 65 upon the maturity of the recent loan. As for a corporation, 60% must be owned by Filipinos. In addition, it must have at least three years of successful business operations.
The acceptable collaterals are residential, commercial, and industrial properties. It either has improvements or none. It includes real estate mortgages. Also, RCBC accepts deposit placements, Joint and Several Signatures of principal officers on bonds, shares and stocks, and machinery, equipment, and inventory. If you are a startup with no collateral, this loan is unfit for you.
Usually, clients must submit personal, income, and trade documents. Also, they must include a photocopy of the passbook of all the client’s banks for the last six months. It does not include automated transfer accounts. In addition, the applicant must present the last three months’ credit card bills. You can’t get an SME loan if you do not have a credit card. In addition, utility bills must be with proof of payment.
Credit Line and Accounts Receivable Purchase Line
With Credit Line, the entrepreneur gets a loan with a promissory note covered by collateral the bank has approved.
On the other hand, the client can use the Accounts Receivable Purchase Line. Also, real estate is applicable. In addition, post-dated customer checks are also acceptable. Simply said, if you have customers who haven’t paid yet, it causes your company to get stuck. Furthermore, RCBC gives you a loan based on unpaid invoices in faith that your customers will eventually pay. Newer checks are preferable to old ones.
This SME loan payment may be in a year and renewed annually. Also, the interest is payable in advance. Meanwhile, the principal loan is payable later before the maturity of the loan.
Domestic Standby Letters of Credit
The Domestic Standby Letter of Credit is a letter issued by a bank on your behalf to increase your creditworthiness. This will make your bank responsible for your credit if you become incapable of paying.
Moreover, the Issuance Fee has a minimum amount of P2,000 or 1/8 of 1% of the certificate’s amount. Then, multiply by the number of months the certificate will be valid. Therefore, the loan is usually used for additional working capital or additional equipment for production.
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This loan finances business expansion, construction, renovation, and acquiring fixed assets. When you apply for a loan, you can expand for up to seven years. However, if your purpose involves construction, the actual building must not exceed a year of construction. As a result, you must provide an illustration or vicinity map of the location. Also, you may try using the RCBC loan calculator to estimate the loan amount you take at a specific term.
Depending on the bank’s approval, you can pay only the interest for the first year or during construction. The principal loan is payable a year after the drawdown date.
Whichever you use as your SME loan, you must remember to list all of your major suppliers and customers with their contact persons and contact details. If you are a conservative entrepreneur on your customers, always ask them if you can give their details to the bank. Also, if your business needs do not reach P1,000,000, it is better to opt for another option. In addition, remember that as a golden rule of borrowing. You only must borrow what you need and the amount you can confidently pay to avoid further financial dilemmas.
RCBC Savings Bank’s My Biz Loan may be complicated for small to medium enterprises. However, it only happens if you cannot meet the requirements.