According to a statement on Wednesday, 212 lawmakers voted in favor of House Bill 8714, which seeks to amend Republic Act 6977, or the "Magna Carta for Micro, Small and Medium Enterprises".
Cagayan de Oro City Rep. Maximo Rodriguez Jr., principal author of the bill, said there is a need to strengthen the Magna Carta for MSMEs.
He noted the lack of access to financing and related forms of support as the major handicap for MSMEs.
“The MSME Sector accounts for 62.8 percent of total jobs generated by all types of business establishment in 2014. Of the total number of MSMEs, 90.3 percent are micro enterprises, 9.3 percent are small enterprises and 0.4 percent are medium enterprises,” Rodriguez said.
The bill mandates the national government, its bureaus, offices and agencies to allocate at least 10 percent of all its procurement opportunities for goods and services to eligible MSMEs.
It provides that the Small Business Corp. (SB Corp.) can extend all forms of financial assistance to eligible MSMEs except grants and subsidies.
The bill mandates the national government to provide for the full capitalization of the SB Corp. within five years.
A seed amount of at least 10 percent of the additional equity contribution of the national government to the capitalization of SB Corp., but not more than PHP500 million shall be set aside to fund the venture capital and micro finance trust fund.
The bill seeks to extend for another 10 years the implementation of the mandatory allocation of credit resources by the banks for MSMEs.
It also increases the penalties for non-compliance of the banks with the mandatory lending.