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    Feature Article

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    INQUIRER FEATURES

    INCREASING ECONOMIC PARTICIPATION

    Nurturing the entrepreneurial spirit of


    Filipinas
    By: Marie Josephine M. Ocampo - @inquirerdotnet
    Philippine Daily Inquirer / 02:02 AM March 22, 2024

    Marie Josephine M. Ocampo —CONTRIBUTED PHOTO

    Women’s roles in our society are important food for thought as we celebrate
    National Women’s Month. The celebration’s theme, WE (Women and
    Everyone) for gender equality and inclusive society, prompts us to reflect on
    women’s participation across key sectors.
    Based on the World Economic Forum’s 2023 Global Gender Gap Report, the
    Philippines remains the top-ranked country in Asia for gender equality, placing
    16th out of 146 countries. Economic participation and opportunity are among the
    factors assessed, referring to the availability of employment and access to the
    labor market. Simply put, for the gender gap to narrow, women need to have
    access to quality jobs and business opportunities.

    One way to ensure women’s economic participation is through entrepreneurship,


    which comes in various forms. Filipinas have a long history of ingenuity and
    resourcefulness, evident in the sari-sari stores, market stalls, carinderias, online
    shops and similar businesses throughout the country. These endeavors,
    regardless of scale, contribute to the economic dynamism and vibrancy of
    communities.
    These businesses are classified as micro, small and medium-sized enterprises
    (MSMEs). As of 2022, the Philippine Statistics Authority reported that MSMEs
    accounted for 99.59 percent of total businesses in the country.
    The majority of these are microenterprises (90.49 percent) followed by small
    enterprises (8.69 percent). MSMEs generate 40 percent of our gross domestic
    product and 65.1 percent of total employment. With these contributions, MSMEs
    can be considered the cornerstone of the Philippine economic landscape.

    READ: Ecosystem of support for small entrepreneurs

    Where are women in the picture? The latest available data show that around 53
    percent of MSMEs are women-led (UN Women, 2022). This significant
    presence highlights women’s crucial role in the sector. To further empower
    women entrepreneurs, fostering their participation is essential.
    ‘Ir

    Barriers encountered
    2023 Asian Development Bank study reported the following barriers that women
    encounter in the MSME sector:
     Access to credit and capital: Women entrepreneurs tend to be more hesitant to
    apply for funding because they believe that the cost, process and documentation
    requirements are complex.
     Utilization of financial services: Only 17 percent of women-led MSMEs use a
    business or merchant account compared with 39 percent of men-owned MSMEs.
     Adoption of digital financial services: Only 28 percent of women-led MSMEs
    use digital financial services versus the 44-percent adoption rate of male
    counterparts.
    Addressing these binding constraints would require the following solutions:
    implementing policies for the empowerment of women-led MSMEs, raising
    awareness about credit facilities and digital financial services and tailoring
    financial products to meet the needs of women entrepreneurs.

    Initiatives to address issues


    Some measures that aim to promote the welfare of MSMEs are already in place.
    One is the National Strategy for Financial Inclusion (NSFI) 2022-2028 of the
    Bangko Sentral ng Pilipinas. The NSFI identifies strategic objectives and
    programs to accelerate financial inclusion among Filipinos.

    One of its priorities is enhancing the MSME financing ecosystem by


    strengthening local government-based credit enhancement schemes, boosting the
    capabilities of rural financial institutions for MSME lending, and developing
    frameworks and tools for collecting and sharing MSME data for credit
    evaluation, among others.

    Another is the recently signed Tatak Pinoy Act. This aims to strengthen the
    government’s collaboration with the private sector to support domestic
    enterprises in promoting the global competitiveness of local goods and services.

    The law has a key provision on access to financing for MSMEs (Sec. 13), which
    states that the state and private financial institutions should ensure availability of
    low-interest or flexible term loan programs, credit guarantee programs and other
    modes of financing for MSMEs.

    Private banks also do their part to bring innovative financial services to MSMEs.
    BanKo, the microfinance arm of the Bank of the Philippine Islands, is dedicated
    to offering accessible and affordable financial services to support the
    government’s financial inclusion strategies.

    As of 2022, BanKo has assisted close to 300,000 self-employed


    microentrepreneurs, with a total loan disbursement of P37.6 billion.

    BanKo offers low-interest credit facilities specifically tailored to support


    businesses through their NegosyoKo program. These loans come with flexible
    repayment terms and simple application requirements, such as valid ID, utility
    bills and barangay or mayor’s permits.

    Microentrepreneurs
    Notably, 75 percent of businesses supported by NegosyoKo are women-owned,
    highlighting the significant impact on women entrepreneurs. Building on this
    success, BanKo has introduced NegosyoKo Lite, an even more accessible
    option, offering loans as low as P10,000, without interest. NegosyoKo is also
    bundled with Secure Assist, a microinsurance product that gives cash assistance
    for damaged properties caused by flooding.

    Beyond credit, BanKo offers deposit solutions that allow women


    microentrepreneurs to manage their cash flows. PondoKo Savings is a basic
    deposit account with no maintaining balance and can be used for various online
    transactions while Todo Savings is a digital savings account that offers a 4-
    percent interest per annum for those who want to start saving. These products
    help increase women’s financial autonomy to borrow, save and grow their funds.

    Further empowering microentrepreneurs, BanKo, in partnership with Innovaris,


    launched the e’Nay app, a digital marketplace named after hardworking mothers
    (nanays). It connects sari-sari stores directly to distributors and wholesalers,
    allowing them to conveniently order products without leaving their shops.

    By leveraging technology, e’Nay improves the efficiency of these businesses.


    Additionally, BanKo’s network of over 1,700 loan officers, fondly called
    “BanKoMares” and “BanKoPares,” go beyond loan processing.
    These dedicated individuals build direct customer relationships and are trained to
    conduct financial literacy discussions, empowering borrowers with valuable
    financial knowledge.Economic participation is a critical step toward gender
    equality, as it empowers women and reduces systemic inequalities. While
    various factors contribute to gender disparities, ensuring economic participation
    offers a tangible avenue for progress.

    By implementing the initiatives mentioned earlier, we can equip MSMEs with


    the necessary tools to nurture the entrepreneurial spirit of Filipinas, leading to
    greater economic empowerment and a more equitable society. —
    CONTRIBUTED

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