Philippine banks miss MSME lending quota as of June

Philippine banks failed to meet the mandated lending quota for micro, small, and medium enterprises (MSMEs) as of end-June.

Bank loans granted to MSMEs grew by 10.8% to P540.92 billion, but this represented only 4.59% of their total loan portfolio of P11.78 trillion.

This is below the 10% overall requirement under the Magna Carta for MSMEs.

Under the law, banks must allocate 8% of their loan portfolio to micro and small enterprises and 2% to medium-sized businesses.

Loans to micro and small enterprises amounted to P220.55 billion, accounting for just 1.87% of the total loan book, falling short of the 8% quota.

However, banks disbursed P320.37 billion worth of loans to medium enterprises, which accounted for 2.72% of their total portfolio, exceeding the 2% quota.