Financial system digitization boosts biz access to funding

The Philippine government is batting for the reauthorization of the US GSP, which provides zero duty for 3,500 tariff lines.

Around 70 percent of the country’s exports to the US market enter at tariffs through this preferential tariff treatment.

However, it expired on Dec. 31, 2020 and has not yet been reauthorized by the US Congress.

“So far from the (US) exec-

Rodolfo said the US Executive Department is also supportive of the provision that the tariffs paid since 2021 will be reimbursed.

Pascual and Rodolfo are part of the delegation of Marcos during his visit to the US, where he had a bilateral meeting with US President Joe Biden.

The DTI chief said they are meeting at least eight companies in the US hoping to bring in more investments and jobs for the Philippines. (PNA)

Cebu Pacific swings to profitability in Q1

Listed Cebu Air Inc., the operator of budget carrier Cebu Pacific, bounced back to profitability during the first quarter of 2023 on the back of strong passenger and ancillary revenues.

In a disclosure to the Philippine Stock Exchange on Friday, Cebu Air reported a net income of P1.1 billion for the January to March period.

This is a reversal from a P7.6 billion net loss in the same period last year.

Cebu Air said that this is the airline’s “first profitable quarter since the pandemic, as it generated total revenues of P20.9 billion, 211% higher than the first quarter last year.”

The airline said the growth was largely driven by recovery of its passenger business, which generated P14.3 billion, 352% higher year-on-year. This was followed by an- cillary business which generated P5.46 billion, up 221% year-on-year.

Cebu Air said it flew over 4.8 million passengers in the first quarter, 135% higher year-on-year, which drove the seat load factor to jump to 83%, up 13 percentage points year-on-year. The airline added it flew 32,000 flights in the first quarter, up 94% year-onyear.

Digitization of the financial system benefits small businesses, among others, since they will have additional proof required in securing funding.

During the ongoing 56th Asian Development Bank (ADB) annual meeting in Incheon, South Korea, Bangko Sentral ng Pilipinas (BSP) Governor Felipe Medalla said financial inclusion in the country increased during the pandemic following the surge in the use of digital payments after the government implemented movement restrictions.

Small businesses’ access to credit will also improve in line with the greater use of technology in the financial system, he said, “if you include financial trail, that will be very helpful” because the need for collateral will be reduced.

However, Medalla said “there’s no substitute for subsidized guarantee fees for firsttime borrowers.”

Despite this, the BSP chief also pointed out that “the other problem is if people see that government is there, they feel like they can get away without paying”, citing that “(with) the private sector, the obligation to pay is strong.”

“There are many other things but there’s no substitute for government being able to collect taxes properly and being able to target those sectors,” he said.

Medalla said the issue of connectivity and telecommunication signal is being addressed since banks and financial technology firms, which offer electronic payment services, cannot address this.

He said “the private sector is quite imaginative” in delivering services.

“There are many things that only government can do. That’s the signal and making sure that poor people, when they’re hit by disasters, they have a fallback position,” he added. (PNA)