Latest Stories

Draft rules for microfinance NGOs out

Former Cooperative Development Authority Chairperson Lecira “Bing” Juarez talks at the 4th Annual National Microfinance Innovations in Cooperatives Forum at the Sarabia Manor Hotel in Iloilo City, July 8, 2011. The Securities and Exchange Commission has released the draft rules for nongovernment microfinance organizations as part of broader efforts to support businesses of low-income households.

MANILA, Philippines—The Securities and Exchange Commission (SEC) has released the draft rules for nongovernment microfinance organizations as part of broader efforts to support businesses of low-income households.

The rules, posted on the website of the corporate regulator on Wednesday, are also seen to bolster consumer protection efforts and encourage these households to save.

The SEC is seeking comments for the guidelines, which also outline the requirements needed to establish a microfinance-NGO, sets how their funds should be allocated and details the needed documentation, as well as the penalties for violations.

It said covered microfinance organizations may grant loans from P2,000 to a maximum of P150,000 subject to “reasonable and conscionable imposable interest rates and charges.”

The minimum “seed capital” was also set at P150,000 although the SEC has the discretion to require a larger amount.

In terms of how funds will be allocated, the SEC said 70 percent should go to direct lending purposes. Moreover, its total investments in real estate, whether shares of publicly traded firms or “other real estate-based projects,” shall not exceed 25 percent of the organization’s net worth.

Majority of its members must also be Filipino citizens and foreigners will only be allowed to be a member of the said microfinance firm if the individual’s country “accords reciprocal rights to Filipinos.”

For those microfinance firms already operating and currently non-compliant with this rule, the SEC will give them one year to do so after the rules become effective.

Failure to comply means the microfinance organization will be suspended, after due notice and a hearing, for a period of 30 days.

These organizations, which are non-stock and non-profit entities, make use of alternative credit schemes and simplified loan application procedures. The goal is to grant loans to the “poor and low-income households for their microenterprises and small businesses, to enable them to raise their living standards.—Miguel R. Camus

Follow Us

Follow us on Facebook Follow on Twitter Follow on Twitter

Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: draft rules , microfinance NGOs , Philippines , Securities and Exchange Commission (SEC)

Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94


  • Camilla’s brother dies in US after head injury
  • Luisita farmers storm DAR compound
  • Trillanes, Ejercito confident they are not in Napoles’ list
  • Easterlies to prevail in Luzon, Visayas
  • Lacson eyes P106-B ‘Yolanda’ rehab masterplan
  • Sports

  • Mixers trim Aces; Painters repulse Bolts
  • Donaire junks Garcia as coach, taps father
  • ’Bye Ginebra: No heavy heart this time
  • UAAP board tackles new rules
  • Baguio climb to decide Le Tour de Filipinas
  • Lifestyle

  • Photos explore dynamics of youths’ sexual identity
  • 12th Philippine Food Expo set at the World Trade Center
  • No tourist draw, Malang the croc will remain wild
  • The best flavors of summer in one bite, and more
  • Homemade yogurt, bread blended with pizza, even ramen
  • Entertainment

  • Sony developing live-action Barbie comedy
  • California court won’t review Jackson doctor case
  • Return of ‘Ibong Adarna’
  • Practical Phytos plans his future
  • In love … with acting
  • Business

  • Facebook profits triple as mobile soars
  • Insular Honors Sales Performers at Testimonial Rites
  • Apple increases stock buyback, will split stock
  • Cost-recovery provisions for affected gencos urged
  • This time, BIR goes after florists
  • Technology

  • Top Traits of Digital Marketers
  • No truth to viral no-visa ‘chronicles’
  • ‘Unlimited’ Internet promos not really limitless; lawmakers call for probe
  • Viber releases new design for iPhone, comes to Blackberry 10 for the first time
  • Engineers create a world of difference
  • Opinion

  • Editorial cartoon, April 24, 2014
  • Talking to Janet
  • Respite
  • Bucket list
  • JPII in 1981: walking a tightrope
  • Global Nation

  • Filipinos in Middle East urged to get clearance before returning
  • PH seeks ‘clearer assurance’ from US
  • China and rivals sign naval pact to ease maritime tensions
  • What Went Before: Manila bus hostage crisis
  • Obama arrives in Tokyo, first stop of 4-nation tour
  • Marketplace