A LAWMAKER has called on the government to enforce measures ensuring that micro, small, and medium enterprises have the same rights to financing as big corporations, saying supporting MSMEs can promote sustained economic growth and reduce poverty. In a recent privilege speech, Rep. Rufus Rodriguez batted for the strict and full implementation of Republic Act No. 9501, or the Magna Carta for Micro, Small and Medium Enterprises, to remove the constraints to funding assistance for MSMEs. "For the last 30 years, MSMEs have struggled to be given equal footing as their bigger brothers, particularly on the matter of access to credits from banks, both from the commercial and government financial institutions to help them start or grow their businesses," said Rodriguez. "But sadly, despite numerous programs that are supposed to address this issue, we still receive complaints about the difficult access."
The MSME sector is seen as the critical driver of a country's economic growth. In the Philippines, it accounts for 99.6 percent of total establishments, contributes 61.2 percent of the country's total employment, and provides 35.7 percent of total valued added. He added that the MSME sector has been extensively constrained from exporting, acquiring new technology, and engaging in innovation by the lack of financial support. "Many MSMEs are unable to qualify for bank loans, because they lack the necessary track record and collateral." With the government's backing, MSMEs can generate more jobs for undergraduates, out-of-school youths, housewives, and persons with disability, said Rodriguez. A recent study conducted by the Philippine Institute for Development Studies, he said, "concluded that the country's MSMEs fare poorly in terms of access to credit, technology and skills compared with peers in other ASEAN member-states." A study commissioned by the Philippine Exporters Confederation (Philexport) indicated that half of the total loans lent by the banking sector to SMEs came from government financial institutions and the other half from private banks. Of the private banks' share, half was accounted for by only one bank-Planters Development Bank.
