FOURTEENTH CONGRESS OF THE REPUBLIC) 
R 
fi,;y 23 1. 
OF THE PHILIPPINES 
1 
First Regular Session 
1 
S E N A T E  
/ 
Introduced by Senate President Manny Villar 
EXPLANATORY NOTE 
Section 22, Article I1 of the Constitution states “The States recognizes 
the indispensable role of the private sector, encourages private enterprise and 
provide incentives to needed investment.” Likewise, Section 14, Article XI1 
provides that: “the sustained development of a reservoir of national talents 
consisting of Filipino scientists, entrepreneurs, professionals, managers, high 
level manpower and skilled workers and craftsman in all fields shall be 
promoted by the State.” 
Every year, Philippine colleges and universities produce thousands of 
college graduates who crowd the labor force, but cannot land in any job. Thus, 
it results into a huge reserve of unemployed. According to the Commission on 
Higher Education (CHED), more than 447,000 college students graduated in 
schools nationwide in April 2006. Research says that this adds to the 2.8 
million unemployed. 
One way by which 
government 
solve the high 
unemployment rate among college graduates and undergraduate students is 
to teach them to face the world with an entrepreneurial mindset. Thus, they 
should be equipped with skills to be a success, and be a boss of their own . 
Unfortunately, their dreams and aspirations to be self-sufficient at a young age 
are hampered by lack of material and financial resources available to them. 
In line with the above constitutional provisions, this proposed measure 
seeks to promote the establishment, ownership and operation of economic 
enterprises by individuals, particularly college students and graduates. This is 
done by mandating banks and financial institutions, through their credit and 
financing system, to allot at least five per cent (5%) of their loanable funds to 
new college graduates and fulltime college students, including those enrolled in 
technical and vocational schools. With access to financing scheme, they can 
start and put up their own entrepreneurial ventures, thereby foster their 
entrepreneurial mindset and develop skills and values necessary to build the 
backbone of competitiveness in the Philippine economy. 
The CHED shall issue the necessary guidelines to ensure that its 
objective of motivating entrepreneurship among them be realized. Therefore, 
not all new graduates and fulltime students will qualify for the grant of such 
privilege. The the Bangko Sentral ng Pilipinas (BSP) , in consultation with 
and upon recommendation of CHED shall determine the eligibility of applicants 
to such credit and financial assistance, Thereafter, the new graduates and 
students are required to undergo educational training by the BSP and CHED 
in coordination with the Department of Trade and Industry (DTI) to stimulate 
their awareness of entrepreneurship as options for employment and help them 
be more creative, innovative, independent, and self confident which are 
essential attributes for their success. 


In view of the foregoing, early passage of this proposed measure is 
earnestly requested. 


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FOURTEENTH CONGRESS OF THE REPUBLIC ) 
OF THE PHILIPPINES 
1 
First Regular Session 
1 
S E N A T E  
S.B. NO. 3 9 0  
Introduced by Senate President Manny Villar 
AN ACT 
PROMOTING ENTREPRENEURSHIP BY MANDATING BANKS TO PROVIDE 
FIVE PER CENT (5%) OF THEIR LOANABLE FUNDS TO NEW GRADUATES 
AND FULLTIME STUDENTS, AND FOR OTHER PURPOSES 
Be 
it enacted by the Senate and 
House of Representatives of the 
Philippines in Congress assembled: 
SECTION 1. Short Title. - This Act shall be known as the “College 
Graduates and Students Entrepreneurship Act of 2008”. 
SEC. 2. Declaration of Policy. - It is hereby declared the policy of the 
State to promote the establishment, ownership and operation of economic 
enterprises by individuals by fostering entrepreneurial mindset among new 
college graduates and full-time students. 
Towards this end, 
banking 
institutions shall allot, through their credit and financing system, at least five 
per cent of their loanable funds 
to new college graduates and fulltime 
students. 
SEC. 3. Definition of Terms. - As used in this Act, the following terms 
shall mean: 
a. New 
Graduates - those who just graduated from college, including 
those who have finished a technical and vocational course upon the 
effectivity of this Act; 
b. Fulltime College Students - those who are presently enrolled in 
baccalaureate degree or technical vocational course, with at least 


fifteen (15) unit load per semester for the past four (4) semesters from 
the effectivity of this Act; 
Entrepreneurship - an organizer of an economic venture especially 
one who organizes, owns, manages and assumes the risk or danger of 
uncertain outcome or unforeseen condition, especially a business 
enterprise of speculative nature. 
c. 
SEC. 4. Coverage, - This Act shall cover all new graduates and other 
fulltime students in the country. 
SEC. 5. Grant of Credit and Financial Assistance. - 
Banks , 
whether government or private, shall allot at least five per cent (5%) of their 
loanable funds to graduates and fulltime students. Provided, however, that 
such amount loaned shall be exclusively utilized as seed money or capital for 
their business ventures. 
SEC. 6. 
Eligibility for Credit and Financial Assistance. 
- The 
Commission on Higher Education (CHED), in coordination with Bangko Sentral 
ng Pilipinas (BSP) shall issue the guidelines for the availment of credit and 
financial assistance from the banking institutions 
by would-be student- 
entrepreneurs. 
It shall likewise assess and determine the eligibility of 
applicants to such loans. 
SEC. 
7. 
Education 
and 
Training 
for 
Would-Be 
Student- 
Entrepreneurs. - The BSP and CHED, in coordination with the Department of 
Trade and Industry (DTI), shall conduct a training for eligible graduates and 
students within the coverage of this Act in order to promote their 
entrepreneurial mindset, enhance business skills and encourage innovative 
business start-ups. 
SEC. 8 Availment and Payment of Credit and Financial Assistance. - 
The Bangko Sentral ng Pilipinas (BSP), in consultation with, and/or upon the 
recommendation of CHED, shall determine the eligibility of applicants to such 


credit and financial assistance. It shall likewise provide the general guidelines 
for the payment of such loans by college graduates and students. 
SEC. 9.. Implementing Rules and Regulations. - The Commission on 
Higher Education (CHED, in coordination with the BSP and DTI, shall issue 
and promulgate the necessary implementing rules and regulations within (60) 
days upon the approval of this Act. 
SEC.10. Repealing Clause. - All laws, rules and regulations or parts 
thereof, inconsistent with the provisions of this Act are hereby repealed or 
modified accordingly. 
SEC. 11. Separability Clause. - If any part, section or provision of this 
Act shall be held invalid or unconstitutional, no other part, section or 
provisions thereof shall be affected thereby. 
SEC. 119. Effectivity. - This Act shall take effect after publication in the 
Official Gazette and in at least two (2) newspapers of general circulation. 
Approved,