Published : Monday, January 23, 2012 00:00 Article Views : 276 Written
by : RAADEE S. SAUSA REPORTER
BANKS, particularly thrift, rural and cooperative banks. can provide
more financing support to micro, small and medium enterprises (MSMEs)
especially those located in the provinces.
An Asian Development Bank (ADB) SME financing survey indicated that the
universal and commercial banks (UKBs) remain as the primary source of
MSME funds, accounting for over 72 percent of the total amount lent to
the sector.
Niny Khor, an economist in the Economics and Research Department of the
ADB, said that UKBs released about P6 billion in 2010 to MSMEs in direct
loans, seven times higher than the average of thrift banks.
This even as thrift, rural and cooperative banks have managed to
increase their market share to 27 percent during the year, from just 16
percent more than a decade ago.
"There is still room to grow for SME financing, especially in the
micro-small segments," she said in a forum.
Khor said that while there was a significant increase in bank branches
in the last ten years, these were distributed unevenly across the
Philippines and most concentrated in the National Capital Region (Metro
Manila).
In 2007 alone, there were 2,689 banks that served MSMEs and people in
Metro Manila; 1,210 in Calabarzon (Calamba, Laguna, Batangas, Rizal and
Quezon or Region4A); and 885 in Central Luzon (Region 3).
These were much higher compared to only 24 banks in the Autonomous
Region and Muslim Mindanao, and 119 to 543 banks in the other regions.
According to the SME financing survey, banks lend to MSMEs because of
their perceived profitability, their existing relations with large
clients. and because of intense competition for retail customers and
from large corporations.
In the same forum, Khor cited the need to design better policies aimed
to enhance MSMEs in the country.
"Helping small business is also inclusive in gender. In our data, we
also found that about 60 percent of all Philippine enterprises are run
by women," she added.
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