DOTr, LTFRB ink MOU with finance platform
To provide PUVMP loan
THE Department of Transportation (DOTr) and the Land Transportation Franchising and Regulatory Board (LTFRB) have entered into a Memorandum of Understanding (MOU) with Philippine Guarantee Corporation (PHILGUARANTEE) in a bid to provide a “sustainable, accessible, and equitable” financing platform under the Public Utility Vehicle Modernization Program (PUVMP) through the provision of national government equity subsidy.
The Tripartite MOU, which was formalized on May 5, 2022, intends to effectively engage private banks and other financing institutions to provide equitable financing with the assistance of the PHILGUARANTEE, and is in support of the recent issuance of DOTr Department Order (DO) 2022-005 or the “Guidelines on the Expanded Implementation of the Equity Subsidy for the PUV Modernization Program as Provided Under Republic Act No. 11649 Otherwise Known as the General Appropriations Act of FY 2022 GAA and Any Subsequent Legislations” in March 2022.
The initiative reaffirms the DOTr’s commitment to providing more financing “options” for the acquisition of modern units in addition to the special loan facilities under the Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (DBP).
In the full-swing implementation of the PUVMP, the guidelines on availing “Equity Subsidy” will be expanded to cover all modes of public transport, including the modern public utility jeepney (MPUJ), modern minibus, and modern public utility bus (MPUB).
This and the updated subsidy rates per mode will “retroactively” be implemented to cover previous loans from 2018 upon issuance of the guidelines by the LTFRB.
Through the Tripartite MOU, a framework for the strategic partnership among the DOTr, LTFRB, and PHILGUARANTEE is now being established, enabling stakeholders access to private banks and legitimate financing institutions providing additional funding loan programs that are attractive and suitable for the PUVMP.
