The Securities and Exchange Commission is giving non-governmental microfinance enterprises three years from their initial registration to comply with the accreditation requirements imposed by the regulator.
Armando Pan Jr., officer-in-charge of the Office of the Commission Secretary, said in an interview the objective of the newly-enacted Microfinance NGOS Act is to pursue poverty eradication.
The corporate regulator said it is letting microfinance non-governmental organizations to register even before getting accredited.
The law, enacted in November 2015, aims to strengthen NGOs engaged in microfinance as a financial instrument for poor Filipino families that are entrepreneurs.
“The SEC intends to relax the accreditation process for three years so as to allow microfinance NGOs to come forward and for us to finally implement the law that would govern their sector,” Pan said.
The draft implementing rules and regulations of the law covers the criteria for accreditation to include sound and measurable standards on financial performance, social performance, audit and governance.
“Only microfinance NGOs with the primary purpose of implementing a microenterprise development strategy and providing microfinance programs, products and services for the poor shall be accredited,” the draft IRR read.
The certificate of accreditation will be valid for three years until suspended or revoked by the Microfinance NGO Regulatory Council (MNRC).
The MNRC will be composed of four permanent members that include the SEC chairman or designated representative as council chairman, the secretaries of the Departments of Trade and Industry, Finance, Social Welfare and Development, and three members from the microfinance NGO sector.
The rules allow microfinance NGOs to grant minimum loans of P2,000 and up to P150,000.00 maximum, with reasonable and conscionable interest rates and charges agreed to by both the microfinance NGO and its debtor-client.
The maximum individual loan amount is subject to periodic determination by the DTI to reflect the prevailing economic conditions.
The SEC has recently released the draft IRR for public comment and is inviting all organizations, stakeholders and interested parties to submit their views not later than January 25, 2016.
The draft was prepared by the commission together with the DOF, DTI, DSWD, and other NGOs.