The Land Bank of the Philippines (LandBank), a government financial institution, is inviting Filipino inventors to avail of its assistance to commercialise their inventions. According to a recent report, borrowers are encouraged to avail of this assistance as there is a huge fund allotted for this. However, very few are availing. The bank, together with the Department of Science and Technology (DOST), could finance up to 85% of the project cost. The loanable amount depends on the project. In addition, inventors who have tie-ups with companies are also eligible for this loan.
Innovation and Technology Lending Program
- Back in 2017, the Land Bank and DOST-Technology Application and Promotion Institute (DOST-TAPI) signed a partnership for the launch of the Innovation and Technology Lending Program (I-TECH).
- It is a special financing window that the agencies will provide in order to support the commercial production of patented Filipino inventions.
- A lower interest rate for loan assistance will be provided to qualified inventors.
- DOST-TAPI, for its part, will use its Invention Guarantee Fund (IGF) for this program.
- The program hopes to help ease the investors’ burden in raising additional capital to fund the commercialisation of their inventions.
- The bank has allotted more than PHP 1 billion (US$ 19.3 million) for I-TECH.
- However, since its launch in 2017, the Department had only referred four inventors. The bank had only released PHP 8 million (US$ 154,348) for them, leaving more to be used.
- To clarify, inventors cannot simply approach the bank. They should be endorsed by the Department as they are the ones who can determine the technical viability of the proposals.
- The bank, meanwhile, will determine viability on the business side, which would include the project’s profitability, where the raw materials can be sourced and how the product can be marketed.
- The bank would also determine if the inventor has no unpaid credit cards and bouncing checks.
- This is the reason why it would be better for inventors to partner with companies. The companies will not only help in financing, but also with marketing.
- Collateral will be requested if the proposal is found to be very risky and would not generate much income.
- There is no limit as to how much one could loan from Landbank. The cap would be the 85%.
- For instance, if the inventor needs PHP 200 million (US$ 3.9 million), then they can borrow 85% of that amount.
- Moreover, the Department can only allot PHP 5 million per inventor. The bank will provide the remaining amount needed to complete the 85%.
- Loans would be payable for a maximum of 10 years.
Who are Qualified?
As reported, the following qualifies for the loan:
- Filipino inventors with active intellectual property (IP) rights, who are at least 21 years old, with good moral character and who don’t have an obligation to DOST-TAPI, can apply for the loan.
- Enterprises duly authorised by the inventors to use their patents, as well as state universities and colleges, government agencies with active intellectual property rights are also eligible to apply.
- Their projects/inventions must be those that save fossil energy; promote Philippine exports; produce gadgets that lower production costs; result in increased productivity in primary industries; among others.