Intra Day Investing

  /  Economy   /  Substitute bill tasks SBCorp. with offering competitive alternative to moneylenders

Substitute bill tasks SBCorp. with offering competitive alternative to moneylenders

THE House committee on micro, small, and medium enterprise (MSME) development approved a substitute bill positioning the Small Business Corp. (SBCorp.) as a possible alternative to usurers typically resorted to by small businesses.

The unnumbered substitute bill authorizes SBCorp. to directly lend to MSMEs 40% of its Pondo sa Pagbabago at Pag-asenso Fund, and the remaining 60% indirectly via accredited partner financial institutions (PFIs).

Representative Christian S. Unabia, who chairs the committee, said at the hearing: “Our target is to give 1% interest rate directly to our borrowers (and a) 2.5% interest rate for the borrowers from our PFIs,” he said, referring to the cap on lending rates set at 1% per month for direct lending and 2.5% per month rate via PFIs.

Angelito B. Acupan, head of SBCorp.’s Planning and Policy Management Group, requested a three-year transition period “in order for (SBCorp.) to meet the 60-40 ratio given that it would really take time to build up a considerable portfolio of direct lending for micro and small enterprise loans.”

Underserved and unserved enterprises will enjoy priority access to the fund, subject to review and approval of the Micro, Small, and Medium Enterprise Development Council.

PFIs include rural banks, thrift banks, development banks, cooperative banks, non-stock savings and loan associations, microfinance non-government organizations, and lending companies.

The bill must also clear the committee on appropriations.

The MSME committee also conducted initial deliberations on House Bill 3632, which proposes to make the Mentor Me Program a function of the Go Negosyo center, while also classifying business counsellors of the Go Negosyo centers as full employees of the Department and Trade Industry (DTI).

The counsellors provide business registration assistance, advisory, and business information and advocacy to MSMEs at Negosyo Centers.

“It is hoped that service delivery to MSMEs in the regions will be improved through the 1,334 (Go) Negosyo centers that have been established as of June 30, 2022,” Mr. Unabia said in his sponsorship speech.

The committee deferred approval of the bill to await position papers from the DTI and Department of Budget and Management. — Beatriz Marie D. Cruz

Post a Comment