HOUSE SPEAKER Alan Peter S. Cayetano has filed a bill which aims to institutionalize a simplified loan program with low interest for micro, small, and medium enterprises (MSMEs) in the country.

Mr. Cayetano filed House Bill No. 5 or the “Puhunan, Tulungan, Kaunlaran Act of 2019.” It provides a loan program with much lower and affordable interest rates to prohibit enterprises from resorting to “5-6” lenders.

Under the proposed loan program, first time borrowers can loan P10,000; P30,000 for second time borrowers; and P250,000 for third time borrowers. Loan proceeds shall be exclusively used for capital.

Those applying for loans must be at least 18 years old, a member of registered cooperative or association, must bring a comprehensive feasibility study of the business proposal, and has attended a seminar organized by the Department of Trade and Industry.

The proposed measure also creates a comprehensive development and assistance program for MSMEs which will be tailored fit for each administrative region. It seeks to transform MSMEs into five-star businesses.

The measure also mandates free technical and administrative support such as training on development skills, packaging and design, quality control, market promotion, and financial literacy.

Also, the five top-performing enterprises per size and category yearly in each region shall receive grants not less than 10% of their current capital.

Every medium-sized enterprise that evolves into a large enterprise through the help of the program shall also be eligible for a one-time grant of P25,000 for further business capitalization.

The current law that provides help to MSME is the Republic Act No. 10693 or “Microfinance NGOs Act” which encourages non-government organizations to provide microfinance services to MSMEs. — Vince Angelo C. Ferreras