COTABATO CITY – A measure establishing a Bangamoro microfinancing program for micro and small-scale enterprises in the region has been filed on Tuesday, December 21.
The Parliament Bill 164, or the Bangsamoro Microfinancing Act of 2021, seeks to provide an affordable, accessible, simple, and responsive micro-financing program for the region’s micro-enterprises, especially those in the poorest populations.
It also intends to adopt the principles of Islamic financing, such as risk-sharing and equitable distribution of wealth, in the conduct of financing operations consistent with the principles of Shari’ah law.
Under the proposed measure, beneficiaries of the Bangsamoro Microfinancing Program (BMP) are micro, cottage, and small enterprises, as defined under Republic Act No. 6977, or the Magna Carta for Micro, Small, and Medium Enterprises.
The BMP will primarily be available through accredited partner financial institutions, such as rural banks, cooperatives with lending licenses, micro-financing institutions, or lending companies duly licensed by the Bangko Sentral ng Pilipinas, the Cooperative Development Authority, or the Securities and Exchange Commission.
MP Amilbahar Mawallil, main author of the bill, said that through this measure, the promotion and development of Islamic financing for micro and small-scale enterprises will further help the Bangsamoro government’s efforts to encourage and support the building of entrepreneurial capability in the region.
The features of the Bangsamoro Microfinance program are:
• The concept of risk-sharing (Mudarabah), wherein the PFI shares in the profit and loss of the enterprise it underwrites;
• The avoidance of any ambiguity and deception (Gharar) that may come from ang contract or agreement relative to financing transactions pursued under this Act;
• No interest rate shall be imposed on the loan availed of;
• It shall not extend to individuals or enterprises who ate engaged in activities which are considered as haram or forbidden, such as producing or selling alocohol or pork;
• There shall be no collateral requirements; and
• The loanable amount for individual loans shall be set and regularly reviewed by the Bangsamoro Parliament an annual report on the status of the BMP.
“The enactment of this bill will help create an environment conducive to the development and growth of vibrant regional enterprises and will act as a catalyst for intensified private sector activity to accelerate and sustain regional economic growth,” MP Mawallil said. (LTAIS-Public Information, Publication, and Media Relations Division)