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PHILIPPINES
Financing
July 17, 2007

Micro enterprises prefer local usurers
Micro enterprises in Davao prefer to access credit financing from local usurers or “five-six” since the latter do not require voluminous requirements compared to established financing institutions, according to an official from the Department of Trade and Industry (DTI) in Davao City.

DTI Davao Senior Trade and Industry Development Specialist Marie Anne How said DTI did not fall short in informing micro entrepreneurs on the available financing institutions that are offering credit financing windows to micro enterprises or businesses with a capitalization of 3 million pesos and less.

How said small and medium enterprises (SMEs) are those that have total assets of P3 million to P15 million.

How made the comment in reaction to a question raised by media on why DTI seemingly focuses on assisting small medium enterprises to the neglect of micro enterprises who are also considered engine of the Philippine economy.

She, however, clarified that DTI Davao is also assisting the micro enterprises by giving them technical assistance and trainings on entrepreneurship and management to improve their livelihood.
Of DTI’s beneficiaries, 50% comprises micro enterprises and 30% small and medium enterprises (SMEs), she said.

Nevertheless, most of the micro enterprises opt for the usurers to easily access loans without complying with numerous loan requirements particularly, the aspect of collateral.

How said the Small and Medium Enterprise Development (SMED) Council will address the problem. PNA

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