Government financing institutions in the Philippines are including support for letters of credit (L/Cs) in financing programmes and facilities they are making available to exporters and micro, small and medium enterprises (MSMEs).

The Development Bank of the Philippines (DBP) and Land Bank of the Philippines (LandBank) both provide a range of L/C offerings for both existing businesses and start-ups.

DBP's export support

At DBP, export products and services offered by the bank include commercial L/Cs and standby L/Cs. Other offerings provided by the bank include documents against acceptance, documents against payment, open account, direct remittance and advance payment.

The bank also has an agreement with the bureau of customs to automate the collection and remittance of customs fees and charges that are generated through the 17 customs districts nationwide.

Offerings from LandBank

LandBank is offering what it describes as tailored-fit financial solutions that meet the needs of exporters, typically credit facilities including a mix of short-term loans, term loans and export packing credit lines.

The bank's export packing credit line is a short-term loan that provides assistance to exporters who are beneficiaries of an L/C for their pre-shipment working capital requirement such as for production of goods for export and cost of labour.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.