LTFRB Pushes for Flexible Financing for Modernized Jeepney Operators
MANILA, Philippines — The Land Transportation Franchising and Regulatory Board (LTFRB) is actively pursuing a collaborative approach with government financing institutions (GFIs) to support modernized jeepney operators struggling with loan repayments under the Public Transport Modernization Program (PTMP).
LTFRB chair Teofilo Guadiz III emphasized the need for cooperation among the LTFRB, Land Bank of the Philippines, Development Bank of the Philippines, and other lenders. This partnership aims to ease the financial strain on jeepney cooperatives and individual drivers who purchased modernized units through loans provided by the program.
“We recognize the financial difficulties many modernized PUV operators face. We are initiating talks with our partner GFIs to explore more flexible loan terms, grace periods, or restructuring options,” Guadiz said.
Addressing Loan Defaults to Protect Public Transport
Guadiz highlighted the importance of flexible repayment schemes, including possible moratoriums for cooperatives that comply with LTFRB standards. “Allowing defaults is not an option. If operators fail to pay, public transport services will be disrupted, and the entire modernization effort will suffer,” he warned.
The LTFRB is coordinating with the Department of Transportation (DOTr), Land Bank, and DBP to hold high-level discussions. These talks may lead to improved loan conditions, longer repayment periods, or government-backed subsidies to support operators.
Ensuring Sustainability of Modernized Jeepney Program
The regulator’s goal is to maintain program continuity while safeguarding the welfare of transport cooperatives. These groups have invested heavily in modern jeepneys, relying on loans linked to the PTMP, formerly called the Public Utility Vehicle Modernization Program (PUVMP).
Operators have voiced concerns about falling passenger numbers in some areas, rising maintenance expenses, and rigid amortization schedules that do not reflect daily income fluctuations.
While many support the modernization initiative, high costs remain a significant challenge. Modern jeepney units cost between ₱1.6 million and ₱2.4 million, posing a substantial financial hurdle for many operators.
Under current loan packages from Land Bank and DBP, borrowers can finance up to 95 percent of the vehicle cost. However, they must repay within seven years at a fixed 6-percent annual interest rate, which some operators find difficult to manage.
Flexible financing options could help address these challenges and sustain the program’s long-term success.
For more news and updates on modernized jeepney financing, visit Filipinokami.com.