The Asian Development Bank (ADB) has signed a $115 million (in Philippine peso equivalent) financing package with Asialink Finance Corporation to expand its working capital and support small and medium-sized enterprises (SMEs) in the Philippines, especially those led by women.
The financing was led by ADB, which served as the overall mandated lead arranger, bookrunner, and structuring bank. HSBC participated as joint mandated arranger and bookrunner while Security Bank Capital Investment Corporation acted as mandated lead arranger. The financing package consists of a $50 million loan from ADB, $50 million from HSBC through the HSBC ASEAN Growth Fund, and $15 million from Security Bank Corporation. Paulton & Company also served as an exclusive financial advisor to Asialink for this transaction.
The project is expected to increase Asialink’s total loans to SMEs from Php 8.8 billion (around $150 million) to around Php 13 billion, with more than half of the financing dedicated to SMEs that are women-owned or led. This will nearly double Asialink’s female entrepreneur borrowers to at least 20,000, and introduce tailored offerings to women business owners.
“Nonbank financial institutions play a key role in providing services to unbanked SMEs. This partnership between ADB and Asialink will enhance SMEs’ access to finance, especially for women entrepreneurs who face greater challenges in obtaining capital,” said ADB Director General for Private Sector Operations Suzanne Gaboury. “This project showcases ADB’s strong commitment to advancing financial inclusion and growth of SMEs, which are key drivers of the Philippine economy.
The financing gap for SMEs in the Philippines is estimated at around Php 67 billion to Php 180 billion. Recent surveys have shown that half of SMEs owned by men transact using bank accounts compared to only 24% of women. Only 14% of SMEs run by men have received approval for bank loans, which drops precipitously for women to only 4%.
“This partnership with ADB marks a transformative milestone in Asialink’s mission to empower small and medium-sized enterprises across the Philippines, especially women-led businesses that remain underrepresented in the financial sector. We are optimistic that through this collaboration, we can continue to expand our presence nationwide, introduce personalized loan products, digitize and innovate our loan processes, and ultimately ensure that entrepreneurs have access to reliable financial solutions”, said Robert B. Jordan Jr., CEO of Asialink Finance Corporation.
Asialink was established in 1997 and has become one of the leading nonbank financial institutions in the Philippines. Through 247 branches nationwide, it provides secure lending to SMEs using motor vehicles as collateral. SMEs account for more than half of their portfolio. Earlier this year, Asialink received a Php 4 billion strategic investment from Creador, a leading regional private equity investor that supports best in class financial services companies with their expansion initiatives. The ADB financing package builds on this positive momentum and will help Asialink accelerate its growth plans.
ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 69 members—49 from the region.
