Bank loans to small, big businesses breach P96B

a man standing in front of a building

© Provided by The Manila Times

Bank lending to small and large businesses have exceeded P96 billion as of late July after the Bangko Sentral ng Pilipinas (BSP) relaxed reserve requirement rules for lenders.

In a statement on Tuesday, the central bank said it saw “an increase in the amount of bank loans extended to micro, small and medium enterprises (MSMEs), as well as [to] large enterprises that are booked in compliance with their reserve requirements, following BSP’s relief measures to ease the impact of the Covid-19 (coronavirus disease 2019) pandemic.”

Citing preliminary data, the Bangko Sentral reported that 97 banks extended loans to MSMEs as an alternative mode of compliance with their reserve requirements with an average daily balance of P84.2 billion as of the reserve week ending July 23.

The amount was a 750.5-percent increase from the P9.9 billion average daily balance used by 55 banks after the

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How do small personal loans work?

Do your homework if you want to take out a personal loan to cover your emergency expenses. (iStock)

According to a report by the Bureau of Labor Statistics (BLS), Americans spend most of their money on rent, groceries, transportation, and health insurance. Rent or mortgage typically makes up about 32% of consumer’s expenses, food makes up almost 13% of yearly costs, and transportation (including car payments and fuel) make up about 15.9% of an individual’s expenses. The BLS report noted that the average American household earns $78,635 before taxes. The average family spends more than $61,000 each year, and those numbers don’t include consumer debt payments.

The coronavirus pandemic has exacerbated tight budgets and made it much more difficult for households to find money in case of an emergency. According to the most recent report from NORC, at least 20% of Americans reported difficulty paying bills, job loss,

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Bank deposits preferred over PPF, other small savings even as interest rate falls: SBI Research

It is largely believed that positive real interest rates act as an enabler of household savings.

Savings normally flows into assets that are generating better yield. When interest rates on fixed-income investments such as bank fixed deposits are high, the household savings generally flows more into them. However, in the current scenario, something contradictory seems to be happening. According to a research report from State Bank of India’s Economic Research Department – Why negative real rates could now be the norm?, authored by Dr. Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India, people are increasing their savings even as we are facing negative real interest rate but people are saving money as a  precautionary motive.

The report suggests that there is a large empirical literature of the determinants of household savings in India. In particular, it is largely believed that positive real interest rates act as an

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