Comelec’s money ban bad for small, medium enterprises, say business leadersBy Riza T. Olchondra
Philippine Daily Inquirer
MANILA, Philippines—Business leaders concerned about operations of small and medium enterprises criticized the Commission on Election’s (Comelec) “money ban.”
The money ban prohibits the withdrawal of more than P100,000 from banks and other financial institutions from May 8 to May 13. The Comelec has also prohibited the “possession, transportation and/or carrying” of more than P500,000 in cash.
“That is a poorly made resolution. It will not really address concerns on vote buying but will create difficulties for businesses, especially medium and small establishments, and workers who depend on them,” Philippine Chamber of Commerce and Industry (PCCI) vice-chairperson Donald Dee said in an interview.
Dee noted that businesses too small to automate wages, for example, would still give out cash. “What will happen to workers who are supposed to get their wages on Saturday? Will small businesses have to make several small withdrawals instead of P100,000 or more? That’s too much hassle for them,” Dee said.
Management Association of the Philippines president Melito Salazar said in a text message that the resolution seemed “well intentioned” but he saw many implications especially for businessmen paying suppliers, usually in cash.
“(The amount) P100,000 is not that big these days so the impact really is on SMEs. If I were a businessman I may just sacrifice being liable and explain later that I used the money for my business. In other words, it is a law that people will not take seriously,” he said.
Besides, Salazar said, money to be used to buy votes might have already been withdrawn.
Chamber of Thrift Banks executive director Suzanne Felix, meanwhile, said in a statement that thrift banks should abide by all laws, rules and regulations. “While we recognize and support the Comelec’s efforts to ensure clean and honest elections, we are concerned that limitations or hindrances on withdrawals, check encashments, and transportation of cash may disrupt banking operations as well as normal business and commercial transactions in the country,” Felix said.
The Bankers Association of the Philippines said Wednesday its members will not comply with the Comelec’s “money ban,” which the group said would be disruptive to business and commercial transactions within the economy.
In a text message to the Philippine Daily Inquirer Wednesday morning, BAP president Lorenzo Tan said banks would take orders only from appropriate regulators, the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission.
The BSP released a statement late Tuesday indicating it would not order banks to implement the money ban, which has prohibited the withdrawal of more than P100,000 from banks and other financial institutions from May 8 to May 13. The Comelec has also prohibited the “possession, transportation and/or carrying” of more than P500,000 in cash.
The Comelec said the money ban was meant to curb vote buying, believed to be rampant a few days before an election day. But while the BSP called the intention of the Comelec noble, it said the money ban would not be the appropriate measure to achieve the goal of clean and honest elections.
The central bank gave two reasons for its opposition:
- First, the BSP said, the money ban could disrupt normal business and commercial transactions in the Philippines. It said it believed Comelec should pursue other means to help ensure clean and honest elections because sacrificing normalcy of economic activities in the country would be costly.
Second, imposing the provisions of the money ban would violate the laws on the secrecy of peso- and foreign currency-denominated bank deposits, particularly Republic Act 1405 and 6426, respectively. For authorities to be able to investigate suspected violations of the money ban, bank accounts of concerned individuals would have to be looked into, it said.
Tags: 2013 midterm elections , Banko Sentral ng Pilipinas , banks , Business , Donald Dee , Elections , Finance , money , Money ban , Philippine Chamber of Commerce and Industry , small and medium enterprises