TWENTIETH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE
Senate
of tl'f fe' crriar^
25 AUG-7 P6:14
RECEIVED BY:
Senate Bill No. 1155
Introduced by Senator JOEL VILLANUEVA
AN ACT
STIMULATING THE RECOVERY, GROWTH, AND DEVELOPMENT 
OF THE MICRO, SMALL AND MEDIUM ENTERPRISES FOR JOB 
GENERATION AND PRESERVATION, APPROPRIATING FUNDS 
THEREFOR AND FOR OTHER PURPOSES
EXPLANATORY NOTE
Micro, Small, and Medium Enterprises (MSMEs) are indispensable to the 
Philippine economy, comprising 99.63% of all registered business establishments and 
accounting for 66.97% of the Philippines' total employment as of 2023. Of said 
contribution to employment, micro enterprises produced the biggest share (33.95%) 
closely followed by small enterprises (26.26%), while medium enterprises lagged 
behind at (6.77%).1
MSMEs serve as key drivers of economic activity, job creation, regional 
development, and innovation. However, despite their economic significance, MSMEs 
remain among the most vulnerable sectors during periods of crisis and systemic 
disruption. The COVID-19 pandemic exposed and exacerbated these vulnerabilities. A 
study conducted by the Asian Development Bank Institute in February 2021 revealed 
that 61.7% of micro, 49.1% of small, and 35.8% of medium enterprises experienced 
minimal to zero revenues, leading to temporary closures.2 Simultaneously, significant 
workforce retrenchments occurred across all MSME categories, with 68% of micro, 
59.5% of small, and 78.6% of medium enterprises reducing personnel.
Department of Trade and Industry. 2023 Philippine MSME Statistics. Available at 
https://www.dti.gov.ph/resources/msme-statistics/ (Accessed on 7 July 2025).
Asian Development Bank. Covid-19 Impact On Micro, Small, and Medium-Sized Enterprises under the 
Lockdown: 
Evidence from a Rapid Survey in the Philippines. Available at
https://www.adb.org/sites/default/files/publication/677321/adbi-wpl216.pdf (Accessed on 7 July 2025).
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Post-pandemic recovery efforts have been further hampered by successive 
natural calamities and international economic disruptions. These events, coupled with 
inflationary pressures and rising fuel and commodity prices, have imposed substantial 
operational costs on MSMEs, thereby threatening their viability and impeding job 
preservation.
In response to these challenges, this bill proposes a comprehensive legislative 
framework aimed at stimulating the recovery, growth, and long-term development of 
the MSME sector. The measure seeks to provide interest-free financial assistance and 
wage subsidies to enable MSMEs to sustain operations, retain employees, and 
reestablish financial stability. It also provides for the creation of a Contingent 
Assistance Fund designed to support MSMEs in times of national emergencies, natural 
disasters, public health crises, and other unforeseen events that pose a risk to business 
continuity.
This measure is anchored on the State policy to promote a self-reliant and 
independent national economy effectively controlled by Filipinos, as enshrined in 
Section 19, Article II of the 1987 Constitution. It likewise affirms the legislative intent 
to prioritize MSMEs as a strategic sector in national development planning and 
economic resilience.
In view of the foregoing, the immediate passage of this measure is earnestly 
sought.
JOEI^LLANUEVA


TWENTIETH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE 
Senate Bill No.
Senate
Of tiif STtrctnrj’
25 AUG-7 P6:14
RECEIVED BY:
Introduced by Senator JOEL VILLANUEVA
AN ACT
STIMULATING THE RECOVERY, GROWTH, AND DEVELOPMENT OF 
THE MICRO, SMALL AND MEDIUM ENTERPRISES FOR JOB 
GENERATION AND PRESERVATION, APPROPRIATING FUNDS 
THEREFOR AND FOR OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled:
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SECTION 1. Short Title. - This Act shall be known as the "MSME Stimulus
Act.
SEC. 2. Declaration of Policy. - The State recognizes that micro, small and 
medium enterprises (MSMEs) comprise the most significant number of 
establishments in the Philippines and are one of the biggest generators of 
employment in the country. Thus, it is hereby declared the policy of the State to 
support, strengthen, and facilitate the growth of MSMEs for job generation and 
long-term development, and help preserve and sustain their operations in times of 
national emergencies, natural disasters, public health crises, and other unforeseen 
events that pose a risk to business continuity.
SEC. 3. Coverage. - This Act shall cover all MSMEs in the country affected 
by disasters, public health emergencies, war, armed conflict, economic crises, and 
other related contingencies, such as technological or policy-related disruptions and 
analogous causes.


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SEC. 4. MSME Growth Stimulus Program. - An MSME Growth Stimulus
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Program is hereby established to extend assistance, strengthen, and facilitate the
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growth and development of MSMEs for regional job generation and preservation.
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SEC. 5. Modes of Assistance. - The MSME Growth Stimulus Program shall
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have the following components, without prejudice to expansion or creation of other
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modes of assistance:
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a) Interest Free Loans. The Land Bank of the Philippines (LBP) and the
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Development Bank of the Philippines (DBP) shall provide an interest-free loan
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program to qualified MSMEs to support growth assistance, regional job
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creation and continued business operations (MSME Growth Assistance
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Program).
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The MSME Growth Assistance Program shall be subject to the following
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conditions and such other requirements as may be imposed by the
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Department of Finance (DOF) and the Bangko Sentra!ng Pilipinas.
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(1) The maximum loanable amount shall be equivalent to one hundred fifty
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percent (150%) of the MSME's labor and overhead costs for six (6)
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months;
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(2) The loan shall be payable within three (3) years; and
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(3) No collateral shall be required as security for the loan, except if the
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amount of the loan exceeds Three Million Pesos (P3,000,000.00).
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b) Wage Subsidy. The DOF, through the Social Security System (SSS), shall
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provide a wage subsidy to cover all or a portion of the wages of the employees
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of qualified MSMEs (MSME Wage Assistance Program). The wage subsidy shall
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be subject to the following conditions and such other requirements as may be
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imposed by DOF and SSS, in coordination with the Department of Labor and
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Employment (DOLE):
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(1) The wage subsidy shall be based on the regional minimum wage per
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month, but not to exceed Eight Thousand Pesos (P8,000.00) per
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employee;
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(2) The Wage shall only cover rank-and-file employees of qualified MSMEs;
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and


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(3) The term of the subsidy shall be for a maximum period of three (3)
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months.
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S EC. 6. Eligibility Requirements for MSME Growth Stimulus Program.
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-To be eligible to avail of the benefits under the MSME Growth Stimulus Program,
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MSMEs must be:
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a) Duly-registered with the Bureau of Internal Revenue, and no tax-related cases
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or proceedings are pending against it. For this purpose, a Certificate of Good
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Standing or such other appropriate proof shall be presented;
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b) 
Duly registered with, and compliant with all its obligations under all
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government social security programs, including, but not limited, to the SSS,
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Home Development Mutual Fund, and Philippine Health Insurance
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Corporation;
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c) Have no pending labor cases; and
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d) 
As a condition for the availment of the benefits of this Act, must commit to
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maintain its personnel from the time of availment of the benefits under this
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Act up to twelve (12) months thereafter. During the same period, it shall
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further commit to refrain from terminating its employees due to authorized
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causes as provided under Article 283 of the Labor Code of the Philippines,
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unless in exceptional and meritorious cases as determined by the Secretary of
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Labor and Employment.
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Non-compliance with the foregoing conditions shall render any loan obtained
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under the MSME Growth Stimulus Program to be immediately payable with
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corresponding legal interest. In the case of wage subsidy, the non-compliant MSME
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shall immediately refund all benefits received under the Program, with the
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corresponding legal interest.
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SEC. 7. Contingency Fund for MSMEs' Growth Stimulus Program. -
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There is hereby established as a special account with the National Treasury, a
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contingency fund called the MSME Stimulus Contingency Fund for selective
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implementation in priority job-generating industries' sectors such as agri-food and
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fishing or areas affected by disasters, public health emergencies, armed conflict,
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and other related contingencies, such as technological or policy-related disruptions
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and analogous causes.


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SEC. 8. Appropriations. - An amount of One Hundred Billion Pesos
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(PlOO,000,000,000.00) shall be appropriated for the initial implementation of this
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Act, to be divided as follows:
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a) Forty Billion Pesos (P40,000,000,000.00) for the MSME Growth Assistance
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Program, which shall be lodged under the budget of the Department of Trade
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and Industry (DTI);
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b) Forty Billion Pesos (P40,000,000,000.00) for the MSME Wage Assistance
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Program, which shall be lodged under the budget of DOF; and
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c) Twenty Billion Pesos (P20,000,000,000.00) for the MSME Stimulus
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Contingency Fund, which shall be lodged under the budget of DOF.
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Thereafter, an amount of not less than Twenty Billion Pesos
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(P20,000,000,000.00) shall be appropriated annually for the implementation of this
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Act, and augmented by available funds from unprogrammed funds and savings
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realized by any government agency or instrumentality under the Executive
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Department.
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SEC. 9. Implementing Rules and Regulations. - The DOF, DTI, and
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DOLE, upon consultation with appropriate government agencies and other
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stakeholders, shall promulgate the necessary rules and regulations to implement
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this Act within sixty (60) days from its effectivity.
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SEC. 10. Separability Clause. - If any portion or provision of this Act is
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declared unconstitutional, the remainder hereof or any provisions not affected
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thereby shall remain in force and effect.
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SEC. 11. Repealing Clause. - Any law, presidential decree or issuance,
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executive order, letter of instruction, rule, or regulation inconsistent with the
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provisions of this Act is hereby repealed or modified accordingly.
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SEC. 12. Effectivity. - This Act shall take effect fifteen (15) days after its
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complete publication in the Official Gazette or in a newspaper of general circulation.
Approved,