SMALL BUSINESS ENTERPRISE LOAN

A Product Proposal

Ermel O. Tagarda
ETEEAP Student
Background of the Proposal

This proposal aims to help repackage similar existing products in the

market with the benefit of increasing the company portfolio and
coverage and at the same time reach out to micro-enterprise
entrepreneurs which may have the potential to become small and
medium enterprises if their business will grow. Thus providing
additional means for micro entrepreneurs to expand their business
and at the same time alleviate their social status. This will have a
positive impact to the economy.
 Current Market Analysis
FIRM RATE per month TERM STARTING LOAN COLLATERAL PREPAYMENT TERMS Other Charges

None but requires

Bless Microfinance 7.00% 3 months 5,000.00 - 10,000.00 referrals from existing Daily None
clients
None but requires
Oro Integrated Weekly,Bi- monthly,
4.00% 6 - 12 months 15,000.00 - 50,000.00 business permit and None
Cooperative Monthly
residence certificate
4.00% 3 months 5,000,00 - 10,000.00 No Collateral Weekly None
J&J Finance
6.00% 2 months 5,000.00 - 10,000.00 No Collateral Daily None
Original Business Permit
Daily, Weekly, Bi- Notarial, Processing and
Benhi Microfinance 2.80% 6 months 20,000.00 - 50,000.00 and Residence
monthly, Monthly Passbook
Certification
Notarial, Processing and
Eclaire Lending Firm 10.00% 2 months 3,000.00 - 10,000.00 No Collateral Daily
other charges
Mataj 5.00% 4 months 10,000.00 - 20,000.00 No Collateral Daily None

Motorcycle and Vehicle Notarial, Processing and

Granduke 3.00% 6 months 20,000.00 - 100,000,00 Twice per week
[Deed of sale or OR-CR] other charges

Motorcycle and Vehicle Notarial, Processing and

5.00% 158 days 20,000.00 - 100,000.00 Bi-Monthly
C and L Lending [Deed of sale or OR-CR] other charges

10.00% 2 months 1,000.00 - 10,000.00 No Collateral Daily No Charges

Target Customers

• In general, the target market of this facility would be small and

medium business owner in selected barangays with stable
legitimate business of at least 12 months.
BUSINESS STRATEGY
MONDAY
TUESDAY
WEDNESDAY
THURSDAY
FRIDAY
PRODUCT BRIEF

AMOUNT FINANCED : Starting loan will be at Php10,000.00; with a maximum of Php50,000.00 in

future re-availment.

MAXIMUM TERM : 6 months

RATE : 4.00% per month or 24% for 6 months

OTHER FEES TO BE APPLIED: Insurance computation
- based on insurance

Processing Fee - based on matrix

Notarial Fee - 400.00

MODE OF PREPAYMENT: Weekly (depending on schedule of barangay covered)

PROMOTIONAL STRATEGY

• Selection of Target Barangay (until December 31, 2018):

• Check with Barangay Hall as to how many lending investors are registered operating in
the barangay and thier coverage.
• File permit to operate with Barangay – this is additional security for the company in case
of defaults made by the client [they would be able to assist the company for the
barangay level – small claims]
• Hand out marketing flyers to the barangay in introducing the product.[which shall be duly
approved by the president before distribution]
• Conduct an actual discussion about the products offered by the company to potential
clients whose businesses are prominent in the area.
• Aside from letter c, provide business consultation, for the people in the area to have an
additional idea of possible businesses they could open with the help of the company.
FINANCIAL ASSUMPTIONS
Forecasted Volume

Period No. of Clients

May - November 2018 30

November - May 2019 50

June - December 2019 85
January - July 2020 84

August - December
2020 83
FORECASTED FINANCIALS

Income Statement
Balance Sheet
Cash Flow
FORECASTED INCOME STATEMENT
FORECASTED INCOME STATEMENT
(With additional personnel)
2018 2019 2020
Interest Income 84,200.00 285,600.00 438,800.00
Other Income 21,443.38 53,856.71 76,281.36
Total Gross 105,643.38 339,456.71 515,081.36

Salary and Wages (338*30) - 111,540.00 111,540.00

Staff Benefits (338*30)/12 - 9,295.00 9,295.00
Fuel and Lubricants (Monday to
Friday please) 4,400.00 26,400.00 26,400.00
Motor Subsidy (890 per month) - 9,790.00 9,790.00
Collector's Insurance - 5,569.20 5,569.20
HMO - 10,083.33 10,083.33
Total Additional Cost 4,400.00 172,677.53 172,677.53

Total Operating Income 101,243.38 166,779.17 342,403.83

Income Tax 30,373.01 50,033.75 102,721.15
Net Income 70,870.36 116,745.42 239,682.68
FORECASTED CASH FLOW

FORECASTED December December December

May 2018
CASH FLOW 2018 2019 2020
Cash
beginning 300,000.00 92,770.54 9,381.68 6,754.19

Collection
(add) - 77,500.00 170,500.00 226,300.00

Monthly Cost 1,605.37 10,892.95 28,266.06 34,691.36

Bookings
(deduct) 175,336.67 60,733.68 147,334.56 195,720.65

Cash, end 123,057.96 98,643.90 4,281.05 2,642.18

FORECASTED BALANCE SHEET

December December December

May 2018
BALANCE SHEET 2018 2019 2020
Cash 123,057.96 98,643.90 4,281.05 2,642.18
Loan Portfolio 229,400.00 339,966.67 606,566.67 904,166.67
Total Assets 352,457.96 438,610.57 610,847.72 906,808.84

Unearned Interest 44,400.00 65,800.00 117,400.00 173,000.00

Accounts Payable 4,312.09 1,940.21 5,831.94 6,510.38
Advances from Head
Office 300,000.00 300,000.00 300,000.00 300,000.00
Retained Earnings 3,745.87 70,870.36 187,615.78 427,298.47
Total Liability and
Equity 352,457.96 438,610.57 610,847.72 906,808.84