Bank loans to micro, small firms still below required level

MANILA, Philippines — Bank loans to micro and small enterprises (MSEs) remained below minimum levels in the second quarter, according to data from the Bangko Sentral ng Pilipinas (BSP).

The Magna Carta for MSMEs (micro, small and medium enterprises), or Republic Act 6977, mandates banks to set aside at least 8 percent of their total loan portfolio for MSEs, and at least 2 percent for medium enterprises (MEs).

As of June, Philippine banks should have lent P942.63 billion to MSEs, and P235.66 billion to MEs, based on a total loan portfolio of P11.78 trillion.

However, the banks have provided only P220.55 billion in loans to SMEs, or P722.08 billion short of the minimum amount, but lent P320.37 billion to MEs, or an excess of P84.71 billion.