Packworks, a Filipino startup offering a business-to-business FMCG marketplace for sari-sari stores, is partnering with 1Sari Financing Corporation to provide access to secure, reliable, and affordable inventory financing services to more than 270,000 unbanked sari-sari stores in the country.
Under the partnership, sari-sari stores will be able to access a starting credit line of P2,500 through 1Sari’s inventory financing product, which will be available as an in-app service for Packworks’ partner stores.
Sari-sari stores can use the credit to purchase goods and bolster their inventory, ensuring they’re well-stocked and ready for customer demands.
There will also be a prompt payment rebate scheme to promote good paying habits for borrowers. Stores can get a rebate of as much as P75 if they pay their dues on time and in full, which they can use for their next availment of inventory financing.
Packworks Co-founder and Chief Platform Officer Hubert Yap sees the partnership as another step forward to tapping the immense potential of over 1.3 million sari-sari stores nationwide.
“By reaching the unbanked and underbanked, we’re championing the entrepreneurial spirit that drives our nation forward. Our collaboration with 1Sari Financing Corporation ensures that even the smallest establishments have the tools and resources they need to thrive,” Yap said.
The partnership aims to address the lack of access to crucial financial tools and support for sari-sari stores. The World Bank has identified restricted financing access as one of the primary impediments to the growth and development of micro, small, and medium enterprises.
This is despite the Department of Trade and Industry report that MSMEs make up 99 percent of all business enterprises in the Philippines and are responsible for 65 percent of the nation’s employment.
The challenges stem from various factors. Stringent requirements from traditional financial institutions often categorize many MSMEs as high-risk borrowers.
Given that many of these enterprises are either unbanked or underbanked, they find themselves excluded from vital loan capital.
Many MSMEs also lack knowledge about available financial services and how to access them.
Dindo Velasquez, the co-founder and Chief Finance and Risk Officer of 1Sari, shares, “Collaborating with Packworks supercharges the expansion and funding of well-deserving, credit-worthy sari-sari stores.”
By granting sari-sari stores the ability to tap into crucial financial resources, they can proactively stock up and prepare to meet the heightened demand for various items during this festive period. – Press release