ADB grants GCash lending arm Fuse Financing with P1.75-B credit facility, complemented by catalytic funding from Mastercard to assist Fuse reach priority segments.
Micro, small, and medium-sized enterprises (MSMEs) and girls entrepreneurs across the Philippines are set to realize significantly higher financial access after the Asian Development Bank (ADB) approved a P1.75-billion ($30 million) loan facility to Fuse Financing, Inc., the lending arm of GCash, the country’s leading finance superapp and largest cashless ecosystem.
This primary-of-its-kind partnership within the Association of Southeast Asian Nations (ASEAN) region was officially launched on Feb. 6 on the SMX Convention Center in Taguig City with the theme “Driving Inclusive Finance for Filipino MSMEs” and was witnessed by over 250 MSMEs, including sari-sari store and carinderia owners and girls entrepreneurs. This milestone collaboration enables Fuse to expand its lending portfolio and scale access to credit for the country’s most crucial economic drivers.
MSMEs are a cornerstone of the Philippine economy, accounting for around 40% of the gross domestic product and 63% of total employment. In accordance with the Department of Trade and Industry (DTI), there are 1.24 million registered business establishments as of 2024, over 99% of that are micro, small, and medium enterprises.
Yet, access to financing stays a key barrier. In accordance with an ADB study, access to credit and capital ranks because the second most vital challenge for MSMEs, after access to markets1. With such a financial challenge, it takes lower than 12 months for a small business to shut down operations2.
“This fintech partnership is the first-of-its kind for ADB within the ASEAN region and marks a big step in advancing financial inclusion within the Philippines,” said Isabel Chatterton, Director-General, Private Sector Operations Department of Asian Development Bank. “By combining Fuse’s digital reach with ADB’s development financing, we’re constructing an inclusive digital financial ecosystem that expands access to finance for women-led and rural enterprises across the country.”
“We value our partnership with ADB because it strengthens our ability to expand access to credit for MSMEs and girls entrepreneurs, who’re underserved by the market. By combining our shared expertise and digital reach, we’re advancing financial inclusion and helping more Filipinos grow their businesses,” Mynt President and CEO Martha Sazon said.
ADB can even provide as much as $125,000 in technical assistance to assist Fuse Financing develop tailored financial products and deliver financial and digital literacy training for girls, especially those with limited formal education. This aligns with the broader push of ADB and GCash for digital finance and inclusion across Asia and the Pacific.
Complementing ADB’s financing, the Mastercard Impact Fund, with support from the Mastercard Center for Inclusive Growth also prolonged a catalytic funding to support Fuse in effectively reaching and serving the priority MSME segments.
Fuse Financing, Inc. President and CEO Tony Isidro underscored the importance of this partnership especially in supporting Fuse’s mission of delivering fair loans and expanding inclusive credit access for underserved Filipinos.
“Through our partnership with ADB, with additional support from the Mastercard Impact Fund, we’re strengthening our mission to make credit accessible to each Filipino who needs it most,” Isidro said. “This investment enables us to speed up our support for girls entrepreneurs and small businesses in underserved areas, sectors with immense potential to drive the country’s long-term growth,” he added.
“This collaboration brings together catalytic capital, digital infrastructure and inclusive design to unlock recent pathways for financial security. By working with Fuse Financing and the Asian Development Bank to increase credit to underserved entrepreneurs, we’re ensuring that growth within the digital economy is fair and sustainable,” said Subhashini Chandran, senior vice-president, Asia Pacific, Europe, Middle East and Africa, Mastercard Center for Inclusive Growth.
To commemorate this partnership, 10 MSMEs nominated by the Department of Trade and Industry (DTI) were awarded with capitalization support to assist advance their business operations. DTI Secretary Ma. Cristina Roque also graced the event and delivered a keynote message to all of the MSMEs in attendance highlighting how synergies like this unlock growth and inclusion.
“Greater than the dimensions of financing, what makes this partnership meaningful is its intent: to be sure that capital reaches entrepreneurs who’re able to grow but have long been underserved by traditional systems. By aligning public-sector priorities with private-sector innovation, this collaboration helps widen the trail to formal, fair, and sustainable access to finance for MSMEs,” Secretary Roque said in her speech.
A day of FinLit for MSMEs
Alongside this partnership launch, Fuse gathered over 250 sari-sari store owners and girls entrepreneurs to experience financial literacy workshops designed to assist them manage their funds higher, borrow responsibly, and construct more resilient businesses.
Attendees were equipped with the knowledge to access digital loans, improve their eligibility for loan access, and practice responsible borrowing. As well as, MSMEs were taught the best way to integrate digital platforms into their operations to enhance efficiency.
MSMEs are vital to national progress but remain underserved by traditional financial institutions. In accordance with an ADB study, access to credit stays a most vital challenge for MSMEs3. Leveraging GCash trust scoring system GSCore as a part of the creditworthiness assessment, Fuse eliminates the standard barriers to lending, with no collateral or documentary requirements needed to secure loans, enabling greater credit access for on a regular basis Filipinos.
The ADB-Fuse partnership goals to unlock MSME’s growth potential and contribute to inclusive economic expansion. Unlike traditional financing, the capital is designed for impact, carrying firm social mandates that ensure measurable inclusion. This serves as a model for the way fintech and development institutions can align with purpose, transforming financial access by ensuring that chance reaches those that can create lasting social and economic change.
For more information, please visit www.gcash.com.
1 Asian Development Bank. Aspects affecting micro, small and medium-sized enterprises development in developing Asia. https://www.adb.org/sites/default/files/publication/946586/ewp715-factors-affecting-msme-development.pdf
2 Philippine Institute for Development Studies. Evaluation of the Sustainable Livelihood Program’s Seed Capital Fund for Microenterprise Development. https://www.pids.gov.ph/publication/research-paper-series/evaluation-of-the-sustainable-livelihood-program-s-seed-capital-fund-for-microenterprise-development
3 Asian Development Bank. Aspects affecting micro, small and medium-sized enterprises development in developing Asia. https://www.adb.org/sites/default/files/publication/946586/ewp715-factors-affecting-msme-development.pdf
Highlight is BusinessWorld’s sponsored section that permits advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Site. For more information, send an email to online@bworldonline.com.
Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.