A measure strengthening non-government organizations (NGOs) that provide micro financing to the poor who want to start their own business has been passed by the Senate on third and final reading Monday.

 Principally sponsored by Senator Bam Aquino, Senate Bill No. 2752 or the Microfinance NGOs Act was approved by the Senate with around 100 beneficiaries from different parts of the country in attendance.

 “The approval was a victory for all microfinance NGOs, which, for decades now, have been helping the government’s poverty alleviation program without getting anything in return” said Sen. Bam, chairman of the Senate Committee on Trade, Commerce and Entrepreneurship.

 “The passage of this measure is recognition of their crucial role in lifting our fellow Filipinos from poverty and enabling the poor to build their own businesses and create their own sustainable livelihood,” he added.

 Sen. Bam hopes that the Microfinance NGOs Act will also encourage more institutions to help in the promotion of the development of micro businesses all over the country.

 Sen. Bam said microfinance NGOs provide low-interest, no collateral financing to those who want to start their own small business, luring them away from loan sharks or more commonly known as “5-6”.

 Microfinance NGOs offer a variety of loans – from business, housing, educational and medical – to low-income households with an average nominal interest rate of 2 to 2.5% and a usual loan cycle of 6 months.

 “Mabigat po talaga ang mangutang sa 5-6 dahil halos lahat ng kinikita mo sa araw-araw, doon napupunta. Sa MFI NGOs, magaan na hulog, mahaba pa ang palugit,” said Resureccion Aquino, owner of “Angels” figurines and ceramic display and a beneficiary of a P75,000 from Kasagana-ka Development Center, Inc. (KDCI).

 Aside from loans, microfinance NGOs also provide training programs and seminars to enhance the entrepreneurial skills and financial literacy of their borrowers.

 “Nakakuha na kami ng pautang, nabibigyan pa kami ng libreng insurance at mayroon pang training para sa dagdag na kaalaman,” said Rosana Santos, owner of J-Anmos Homemade Products and a recipient of a P50,000 loan from KDCI.

 The bill also provides microfinance NGOs needed support and incentives that includes access to government programs and projects, technical assistance and exemption from taxes.

 “With this Act, we will be able to reach more Filipinos in poor communities, enabling us to fulfill our mission as an institution – lifting the poor out of poverty and bringing our nation towards development,” said Dr. Aris Alip, founder and managing director of Center for Agriculture and Rural Development – Mutually Reinforcing Institutions (CARD-MRI).

 CARD-MRI is the biggest MFI NGO in the country, with around 1,780 branches in different parts of the Philippines.

 “The support that the bill accords to microfinance NGOs would ultimately benefit the enterprising poor in terms of greater affordability, accessibility, and variety of micro finance programs and services geared towards the expansion of their livelihoods and furthering their transformative contributions to community development,” the Microfinance Council of the Philippines said in a statement.

 With the House version of the measure already approved, a bicameral conference committee meeting will be held in the coming days to consolidate and finalize the provisions before it will be transmitted to Malacanang for President Aquino’s approval.