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Business

Review of compliance by lending firms to MSME funding sought

- Paolo Romero -

MANILA, Philippines – A lawmaker is seeking a congressional review on the compliance of the country’s financial institutions on laws mandating them to set aside a portion of their resources for micro, small and medium enterprises (MSMEs).

Ang Kasangga party-list Rep. Teodorico Haresco, who represents the micro-entrepreneurs sector, requested the House committee on small business and entrepreneurship development to request concerned government agencies to furnish the panel data on the compliance of the country’s lending institutions on Republic Act 6977, as amended by RA 8289 and RA 9501.

Under the law, all lending institutions as defined by the Bangko Sentral ng Pilipinas (BSP), whether public or private, are required to set aside at least eight percent for micro and small enterprises of their total loan portfolio based on their balance sheet as of the end of the previous quarter, and make it available for MSME credit.

The law also created the Congressional Oversight Committee on Micro, Small and Medium Enterprise Development (COC-MSMED) to monitor and oversee the implementation of the law.

Haresco specifically asked Bayan Muna Rep. Teodoro Casino, chairman of the committee, in a letter to ask the Department of Trade and Industry (DTI), BSP and the MSMED Council on funding support for entrepreneurs, particularly the latest consolidated MSME Report “on compliance with mandatory allocation mandated under RA 6977 schedule of outstanding MSME notes or alternative compliance methods such as the purchase of bonds; actual list of beneficiaries per bank/lending institution; and accessibility of funding support.”

In its proposed budget for 2011, the DTI said that “as of 30 June 2010, total bank compliance for MSMEs amounting to P132,872,102.00 for micro and small, and P127,675,560.00 for medium enterprises; with 8.40 percent compliance for micro and small enterprises, and 8.07 percent for medium enterprises.”

Haresco said that while he found the data from the DTI useful, he felt it was insufficient to see the real state of entrepreneurship in the country.

“The legislature needs adequate data to uplift the level of entrepreneurship in the country and help micro-entrepreneurs contribute a bigger share to the economy,” he said.

ANG KASANGGA

BANGKO SENTRAL

BAYAN MUNA REP

CONGRESSIONAL OVERSIGHT COMMITTEE

DEPARTMENT OF TRADE AND INDUSTRY

HARESCO

MICRO

REPUBLIC ACT

SMALL AND MEDIUM ENTERPRISE DEVELOPMENT

TEODORICO HARESCO

TEODORO CASINO

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