CCCI to assist MSMEs to gain financial access

CEBU, Philippines - To maximize the excess liquidity in the Philippine financial system, the Cebu Chamber of Commerce and Industry (CCCI) is going to help the Micro-Small and Medium Enterpreneurs (MSMEs) to tap these resources, in order to pursue business expansion programs that will bolster economic activity in the province.

Through this year’s Cebu Business Month (CBM 2012), the “Emerging & Growing Industries” promotion activity, MSMEs are expected to get clearer picture on how to access capitalization resources, by partnering with financial institutions like the banking sector.

The event’s chairperson Clarito Fruelda said that there is a need to showcase the different financial access to MSMEs in Cebu, specifically that there are a lot of opportunities to do business in the province that would need huge financial requirements.

Banks, along with other financial institutions will be able to help the emerging MSMEs in Cebu, who have appetite to build businesses here particularly in building retirement facilities, medical tourism related businesses, among others.

This event will also showcase other opportunities for business in Cebu, said Fruelda, adding that it is important to update the Cebuano entrepreneurs of the available funds in the financial sector.

Economists had been saying that the Philippines have an excess liquidity, or un-spent income of about P1.7 trillion, larger chunk of this funds is now being distributed by banks to provide the strong demand for consumer loans.

While the appetite of the corporate sector to get financial resources from the banking institutions, economist Eduardo R. Banaag Jr., investors these days have wider options for capitalization requirement, while the capital market in the country is taking off.

This means, that aside from banks, corporations can now borrow directly from the public through issuing security bonds, and other financial access alternatives.

The reason, most banks in the Philippines now are more active in providing attractive packages for consumer loan products, particularly real estate.

On the other hand, Cebuano entrepreneurs continue to call the banking sector’s attention in opening their financial resources to the MSMEs, in order to get their required capitalization for planned expansion, and new business ventures.

Entrepreneur Jay P. Aldeguer believes that there is still a huge gap between the banking sector and the business players specifically the SMEs, and the start-up companies, as banks continued to offer intimidating packages, and can only attract bigger companies.

Aldeguer mentioned a recent survey among budding entrepreneurs that banks are not in the top five choices, in accessing capital.

Start-up businesses in the Philippines do not regard banks as supportive to entrepreneurship, as capital resources are mostly borrowed from parents, and friends.

“Banks are still maintaining intimidating factors. Clearly, there is a huge ‘disconnect’ between the financial institutions, and the business sector,” said Aldeguer adding that this problem should be taken in consideration in the banking sector, specifically that the Philippines need to pump prime its economy to sustain growth, amid the fragile economic global condition.

According to Aldeguer, there is need for banks to re-examine and understand the changing needs of today’s young and vibrant entrepreneurs.     - THE FREEMAN