The Philippine economy rests firmly on the shoulders of millions of micro, small and medium enterprises (MSMEs). These tenacious businesses, often family-run sari-sari stores or local handicraft workshops, comprise the backbone of the nation. Yet, their growth path is often riddled with obstacles, particularly limited access to formal financing.
The recent 8th Asian Innovation Forum (AIF) hosted by the DAILY TRIBUNE at the Dapitan Sports Complex in Manila shed light on this crucial issue. The forum, a testament to this omni-media enterprise’s commitment to public service that transcends mere news reporting, brought together MSMEs, government agencies, and private institutions under one roof.
The powerful synergy, as in the inaugural AIF, aimed to empower MSMEs by equipping them with knowledge of alternative financing options and crucial resources for success.
The forum exposed a stark reality: Many MSMEs, desperate for quick capital, are forced to resort to predatory “5-6” loan schemes. These informal lenders, with their exorbitant 20 percent monthly interest rates, exploit the very vulnerability they claim to address.
One forum participant, a sari-sari store owner, shared their reliance on such a scheme due to its fast turnaround and daily collection structure, highlighting the immediate financial needs of these small businesses.
However, the AIF once again provided hope, showcasing a path out of this predatory cycle. Institutions like the Small Business Corporation (SBCorp), Cebu CFI Cooperative and Maya presented alternative financing solutions with significantly lower interest rates.
SBCorp, an attached agency of the Department of Trade and Industry, offers loan programs tailored to different stages of operation, with rates as low as 1 percent per month. This stands in stark contrast to the crippling interest rates of “5-6” loans.
Beyond financial resources, the forum offered valuable insights. SBCorp president and CEO Robert Bastillo emphasized their commitment to supporting small businesses, not just with capital, but with resources that cater to various stages of growth.
SBCorp’s loan programs cater to new businesses, established enterprises, and even “suki” borrowers with a proven track record. This highlights a holistic approach to MSME development, recognizing the diverse needs of these businesses.
The forum also showcased the innovative spirit of Filipino financial institutions. Cebu CFI Cooperative, a pioneering digital cooperative, offers micro-lending programs with flexible repayment terms.
Similarly, Maya, a user-friendly platform for phone credits, loans, and cash transactions, empowers micro-entrepreneurs by providing a one-stop shop for their financial needs. These institutions, alongside SBCorp, represent a shift towards inclusive finance, ensuring MSMEs have access to the tools and resources needed to thrive.
The impact of MSMEs extends far beyond individual businesses. They are critical drivers of job creation, a crucial factor in a nation with a growing workforce.
Studies show that MSMEs contribute to nearly two-thirds of the Philippines’ total employment. Furthermore, MSMEs fuel economic growth at the local level, stimulating activity in rural and far-flung areas.
By empowering MSMEs, DAILY TRIBUNE’s AIF contributes not only to individual success but also to national economic development and poverty reduction.
The AIF’s success extends beyond its immediate impact. It sends a powerful message to the media landscape. The TRIBUNE, a distinguished recipient of numerous journalism awards, demonstrates that public service goes beyond reporting the news. The AIF serves as a model for how media organizations can leverage their various platforms to create tangible change within their communities. By fostering collaboration between government agencies, private institutions, and MSMEs, the AIF paves the way for a more prosperous and inclusive Philippine economy.
The enthusiastic participation of local government further strengthens the AIF’s message. The forum’s past editions enjoyed the strong support of Muntinlupa, and this year saw the participation of Manila City through Mayor Honey Lacuna and Vice Mayor Yul Servo.
This collaboration between media, government, and the private sector underscores a collective commitment to empowering MSMEs, recognizing their vital role in the nation’s future. As these businesses flourish, they will continue to be the backbone of the nation’s economy, fostering job creation, growth, and a brighter future for all Filipinos.
