TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
,iUL -7 A 9 :28
SENATE 
S. No. 160
Introduced by Senator Loren Legarda
AN ACT
TO PROMOTE AND ADVANCE SUSTAINABLE LIVELIHOOD AND 
ENTREPRENEURSHIP BY INTEGRATING, ENHANCING, AND 
INSTITUTIONALIZING FINANCING AND OTHER PROGRAMS FOR 
LIVELIHOOD SUPPORT FOR MICRO, SMALL AND MEDIUM ENTERPRISES 
(MSMEs), APPROPRIATING FUNDS THEREFOR, AND FOR OTHER 
PURPOSES
EXPLANATORY NOTE
The poor remain to have inadequate access to human capital, enterprise, 
infrastructure, public institutions, and knowledge. Often, the poor have to start 
livelihoods or businesses with meager capital and eventually find themselves trapped 
in a vicious cycle of poverty. In addition, poverty is caused by the inequitable and 
unequal distribution of income and opportunities.
To illustrate this disparity, the poor face inadequate access to human capital, 
enterprise support, infrastructure, public institutions, and knowledge. With an 
average monthly household income of just P12,523/month,1 even a P5,000 sari-sari 
store startup represents a significant financial stretch for poor households. Most 
must secure informal, high-interest loans, perpetuating a vicious cycle of 
undercapitalized microenterprises. Meanwhile, the country's high income 
inequality—where the top 1% claim 17% of national income and bottom 50% only
1 Retrieved June 26, 2025, from: PSA (2023)
https://rsso02.psa.aov.ph/svstem/files/attachment-dir/2025R0215-SR004%202023%20Full%20Ye
ar%20Povertv%20Statistics.pdf


14%, with a Gini index around 40—means the poorest have limited resources and 
opportunity to escape poverty.2
Micro, Small, and Medium Enterprises (MSMEs) comprise 99.5% of business 
establishments in the Philippines3 and employ approximately 63% of the country's 
workforce. In the past, MSMEs were responsible for 40% of the country's Gross 
Domestic Product (GDP).4 MSMEs have the potential for employment generation, 
integral sustainable development, and spur economic growth, especially in rural 
areas. They are considered a driving force in economic development, according to 
the Asian Development Bank (ADB).5 According to the United Nations, formal and 
informal MSMEs make up over 90% of all firms and account, on average, for 70% of 
total employment and 50% of GDP. As such, they are vital actors in achieving a 
green recovery.6 However, despite these, MSMEs in the Philippines receive scant and 
dispersed government support.
MSMEs continue to suffer due to low demand and the lack of financial 
capacity, logistical support, or market access. MSMEs are also most vulnerable to 
external shocks in the economy. During the COVID-19 pandemic, most of the 
MSMEs were forced to close and some remain temporarily closed or are operating at 
decreased capacity. MSMEs suffered the most, especially those led by women, youth, 
ethnic minorities, and migrants. An International Trade Centre survey on COVID-19 
impact among businesses in 136 countries has shown that nearly 62% of women-led 
small businesses have been strongly affected by the crisis and women-owned are 
27% more likely not to survive the pandemic compared to just over half of firms led 
by men. 7 Other challenges, including the ongoing effects of climate change.
Retrieved June 26, 2025, from; World Bank (2022).
httn!q://www.wnrldbank.orQ/en/nevtfs/Dress-release/2022/ll/24/ph-redUCinq-ineqU9liW-kgY;t0:l2g£
omina-a-middle-class-sodetv-free-of-povertv#: ~ ;text=Yet%20ineaualitv%20remains%ZQhiqh;
0the.income%20ineaualitv%20in%20East%20Asia
Retrieved June 26, 2025, from: DTI. https://www.dti.aov.Dh/resources/msme-StatiStiCSZ 
Retrieved June 26, 2025, from: MSME Sector is Key to COVID Inclusive Recovery for the 
Philippines.
https://www.ph.undp.ora/content/philippines/en/home/presscenter/pressreleases/202-/msme-sec
tor-is-kev-to-covid-19-inclusive-recoverv-for-ph.html
Retrieved June 26, 2025, from: Asian Development Bank Institute (2021) COVID-19 Impact on 
Micro, Small, and Medium-Sized Enterprises Under the Lockdown: Evidence from A Rapid Survey 
in the Philippines. https://www.adb.ora/sites/default/files/publication/677321/acltPi-WPl216-Ptlf 
Ibid.
Retrieved June 26, 2025, from: MSMEs: Key to an inclusive and sustainable recovery: 
https://www.un.ora/en/observances/micro-small-medium-businesses-dav.


biodiversity loss, and pollution, are expected to have severe negative implications for 
economic growth, human health and ecosystems, employment, and livelihood.
In line with the Sustainable Development Goals, the Philippine government 
has set one of its overarching goals to reduce poverty incidence significantly. 
Raising the quality of life of Filipinos is not simply a matter of improving the incomes 
of the poor. It also entails increasing the people's capacity to provide for themselves 
and lift themselves out of poverty.
Entrepreneurship has been identified as among the drivers of economic 
development and as an intervention for poverty alleviation. Additionally, sustainable 
livelihoods could serve as an integrating factor that allows policies to simultaneously 
address growth, sustainable resource management, and poverty eradication.8
While there are current laws, policies, and programs for MSMEs or livelihood 
assistance, these laws and policies are deficient, dispersed, or do not directly 
respond to the needs and challenges of MSMEs or the poor and marginalized 
entrepreneurs.
There is a pressing need for MSMEs and underprivileged entrepreneurs to 
access financial assistance and other support programs from the government. They 
need access to monetary and fiscal policies, including credit facilities, tax breaks, and 
deferred loan payments. They also need support in transportation and the 
strengthening of supply chain management. MSMEs and the vulnerable should be 
resilient to the looming climate crisis so that they can be drivers of an inclusive 
transition towards a more sustainable economy.
This bill aims to stimulate entrepreneurship and empower Filipino 
entrepreneurs by ensuring adequate access to existing financing and livelihood 
assistance programs. The proposed measure addresses the need to integrate 
programs and policies responsive to the immediate and long-term needs of MSMEs 
and underprivileged or marginalized but deserving entrepreneurs and further 
enhance benefits for them, including training, information resources, supply chain 
management, and market access. The enactment of this measure would mark the
Retrieved June 26, 2025, from; UNDP. Promoting Sustainable Livelihoods: A Briefing Note 
Submitted to the Executive Committee, June 4,1997.


government's recognition of the pivotal role of MSMEs and entrepreneurs in the 
Philippines as the backbone of the Philippines' economy.
Key provisions include: (1) mandatory allocation of 10% of bank loan 
portfolios for MSME financing; (2) a Pangkabuhayan Fund with 70% direct 
beneficiary allocation; (3) priority for vulnerable groups through transparent 
selection criteria; and (4) a Regulatory Sandbox to pilot innovative business models. 
The measure also introduces safeguards to ensure depoliticized implementation and 
mandates annual impact reviews to assess efficacy.
In view of the foregoing, the urgent passage of this bill is sought.
LOREN LEGARDA


TWENTIETH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
First Regular Session
)
SENATE
S. No. 160
25 JiJL-7 A 9:29
Introduced by Senator Loren Legarda
AN ACT
TO PROMOTE AND ADVANCE SUSTAINABLE LIVELIHOOD AND 
ENTREPRENEURSHIP BY INTEGRATING, ENHANCING, AND 
INSTITUTIONALIZING FINANCING AND OTHER PROGRAMS FOR 
LIVELIHOOD SUPPORT FOR MICRO, SMALL AND MEDIUM ENTERPRISES 
(MSMEs), APPROPRIATING FUNDS THEREFOR, AND FOR OTHER PURPOSES
Be it enacted by the Senate and the House of Representatives of the Philippines 
in Congress assembled:
1 
Section. 1. Short Title. - This Act shall be known as the "Pangkabuhayan Act
2 
of 2025."
3 
Sec. 2. Declaration of Policy. - It is hereby declared the policy of the State that
4 
the diffusion and more equitable distribution of opportunities, income, and wealth shall
5 
be the goals of the national economic development programs; and expanding
6 
productivity, coupled with a sustained increase in the number of goods and services
7 
produced for the direct benefit of the people is the key to empowerment, poverty
8 
reduction, and enhancement of the quality of life for all, especially the
9 
underprivileged. Consistent with the aforestated policy, the State shall:
10 
(a) Promote, strengthen, and encourage sustainable livelihoods,
11 
entrepreneurship, and the growth and development of MSMEs in all
12 
productive sectors of the economy, particularly rural, agri-based
13 
enterprises, research and deveiopment, invention, innovation, cultural and
14 
creative industries, and other careers that contribute to environmental and
15 
cultural preservation;
1


1 
(b) Harmonize and strengthen the implementation of existing MSME laws, social
2 
legislation, and livelihood and poverty aileviation programs to promote
3 
sustainable production, develop skills and capabilities, expand access to
4 
financial services and resource support, improve information flow and
5 
market access, foster value chain participation, and create greater
6 
opportunities for economic empowerment and increased incomes;
7 
(c) Adopt livelihood, entrepreneurial, and/or MSME development and support
8 
that is holistic, comprehensive, integrated, people-centered, responsive,
9 
and participatory, in lessening the socioeconomic and environmental
10 
impacts of disasters including epidemics and climate change, and promoting
11 
the involvement and participation of all sectors and all stakeholders
12 
concerned, at all levels, especially the local community;
13 
(d) Institutionalize the policies, structures, coordination mechanisms, and
14 
programs with continuing budget appropriation from national down to local
15 
levels towards building economic empowerment and improved incomes;
16 
(e) Simplify and minimize procedural rules and documentary requirements in
17 
the act of registration, availing of financing, or accessing government
18 
services;
19 
(f) Complement and supplement financing programs to remove stringent and
20 
burdensome collateral requirements;
21 
(g) Engage the participation of the beneficiaries, especially the poor and
22 
vulnerable, in the design, development, and implementation of sustainable
23 
livelihood policies or programs;
24 
(h) Engage the participation of civil society organizations (CSOs) and the private
25 
sector in the government's livelihood development and support for MSMEs
26 
programs towards complementation of resources and effective delivery of
27 
services to the citizenry; and
28 
(i) Assure a balanced and sustainable development through the establishment
29 
of a feedback and evaluation mechanism that will monitor socio-economic
30 
contributions as well as bottlenecks and environmental effects.
31 
Sec. 3. Scope. - This Act provides for the development of policies and plans
32 
and the implementation of actions and measures pertaining to all aspects of
2


1 
sustainable livelihood development and support and the growth and development of
2 
MSMEs.
3 
Sec. 4. The Pengkabuheyan Council. — The Pangkabuhayan Council is hereby
4 
established to develop the country's sustainable livelihood and entrepreneurship goals,
5 
priorities, and long-term national strategy. The Council shall mainstream principles
6 
that are integrated, people-centered, participatory, responsive, and sustainable in the
7 
development, implementation, and assessment of sustainable livelihood and
8 
entrepreneurial programs and strategies.
9 
Sec. 5. Composition of the Pangkabuhayan Council. - The Council shall be
10 
composed of the following members:
11 
(a) President of the Philippines as the Chairperson;
12 
(b) Secretary of the Department of Trade and Industry (DTI) as the Vice-
13 
Chairperson;
14 
(c) Secretary of the Department of Economy, Planning, and Development
15 
(DEPDev);
16 
(d) Secretary of the Department of Agriculture (DA);
17 
(e) Secretary of the Department of Environment 
and Natural 
Resources
18 
(DENR);
19 
(f) Secretary of the Department of Labor and Employment (DOLE);
20 
(g) Secretary of the Department of Tourism (DOT);
21 
(h) Secretary of the Department of Social Welfare and Development (DSWD);
22 
(i) Secretary of the Department of Science and Technology (DOST);
23 
(j) Chairperson of the Commission on Higher Education (CHED);
24 
(k) Secretary of the Department of Budget and Management (DBM);
25 
(I) Secretary of the Department of Education (DepEd);
26 
(m) Secretary of the Department of Interior and Local Government (DILG);
27 
(n) Director-General of the Intellectual Property Office of the Philippines
28 
(IPOPHIL); and
29 
(o) Seven (7) Executive Members are to be appointed by the President.
30 
The Executive Members shall be appointed from the ranks of business,
31 
entrepreneurs, academe, and the scientific community, at least one (1) of whom shall
32 
be a woman. There shall be at least one (1) representative from the MSME sector.
3


1 
Those to be appointed from the academe and the scientific community shall have at
2 
least seven (7) years of experience in the field of science and technoiogy, research
3 
and deveiopment, or innovation.
4 
The President may designate the Executive Secretary to attend on his behaif
5 
and preside over the meetings of the Pangkabuhayan Council. The Department
6 
Secretaries and other members may not designate alternate representatives other
7 
than their respective undersecretaries to the meetings.
8 
The majority of the members shaii constitute a quorum.
9 
The DTI shaii designate one of its existing units as the iead Secretariat for the
10 
Pangkabuhayan Council. The DTI Secretary may establish a dedicated unit or
11 
designate an inter-staff team to support the Council's coordination, monitoring, and
12 
programmatic functions. Subject to a review of workload, implementation
13 
performance, and budgetary availability, the DTI may propose to the DBM the creation
14 
of a dedicated Livelihood and Entrepreneurship Policy Office within DTI to serve as
15 
the permanent Secretariat for the Pangkabuhayan Council with corresponding plantilla
16 
positions and budget.
17 
Sec. 6. Powers and Functions. - The Pangkabuhayan Council shall have the
18 
following powers and functions:
19 
1. The Council shall act as the primary coordinating and supervising body for
20 
all national government agencies and instrumentalities involved in the
21 
design, implementation, evaluation, and enhancement of programs that
22 
promote sustainable livelihood and inclusive entrepreneurship. The Council
23 
shall ensure the integration, harmonization, and alignment of these
24 
programs with the national strategy for poverty reduction, economic
25 
empowerment, and innovation-led enterprise development.
26 
2. At all times, the Council shall safeguard the integrity and targeting of
27 
support by ensuring that interventions provided to beneficiaries are aligned
28 
with their actual needs, qualifications, and development potential.
29 
Beneficiaries shall be guided to access the most suitable forms of assistance,
30 
whether financial, non-financial, or a combination thereof, based on
31 
transparent assessments, not on personal preference or perceived
32 
entitlement to multiple benefits. To this end. Sustainable Livelihood and
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Entrepreneurial Development (SLED) Centers under Section 7 of this Act 
shail serve as the primary local facilitation hubs, providing accessibie, user- 
friendiy, and needs-responsive guidance to ensure that beneficiaries are 
matched with appropriate programs efficientiy and with minimai burden. 
The system shail be designed to simplify procedures, reduce transaction 
costs, and promote informed decision-making among applicants and 
program implementors alike.
3. The Council shall coordinate the impiementation and poiicy alignment of the 
following programs and initiatives, among others:
a. DTI's Negosyo Center Program, which is responsible for promoting 
ease of doing business and facilitating access to services for MSMEs;
b. DSWD's Sustainable Livelihood Program (SLP), which is a 
community-based program that provides income-generating 
activities to iow-income households;
c. DOLE'S Tulong Panghanapbuhay sa Ating Disadvantaged/Displaced 
Workers (TUPAD) or Cash for Work Program, a community-based 
package assistance that provides emergency employment for 
displaced workers, underemployed, and seasonal workers;
d. DOLE'S Integrated Livelihood Program-Kabuhayan, which provides 
assistance through grants to individuals and groups that can be used 
to start a livelihood project, expand or upgrade an existing project, 
restore or re-establish existing iivelihood projects destroyed due to 
naturai and human-made disasters, or transform existing iiveiihood 
assistance to community/group enterprises.
e. DOST's Small Enterprises Technology Upgrading Program (SETUP), 
a nationwide strategy that aims to encourage and assist SMEs to 
adopt technoiogicai innovations to improve their operations and thus 
boost their productivity and competitiveness;
f. DTI and the Technical Education and Skills Development Authority's 
(TESDA) Barangay Kabuhayan, a national program that ensures that 
all livelihood and skiils training centers offered by the National 
Government are properly implemented at the municipal level.
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g. DEPDev, DOST, and DTI's implementation of the Philippine 
Innovation Act, a law that seeks to guide the country's innovation 
goals and is expected to make the policy environment in the country 
conducive to more science, technology, and innovation efforts;
h. DTI's Shared Service Facilities (SSF) Project, a flagship program of 
the DTI aimed at improving the productivity and efficiency of small 
enterprises through access to better technology; and,
i. 
Other existing or future programs that advance the objectives of this 
Act.
4. The Council shall coordinate with local government units (LGUs), the DILG, 
and relevant private sector organizations or industry associations to monitor 
the progress and development of MSMEs and individual beneficiaries at the 
local level. This coordination shall ensure that the implementation of 
programs under this Act is responsive to local conditions, aligned with 
national priorities, and supported by multi-stakeholder engagement. For this 
purpose, the Council shall work in close coordination with the SLED Centers 
established under Section 7 of this Act, which shall serve as the local 
convergence hubs for program implementation, beneficiary support, and 
feedback mechanisms.
5. The Council shall monitor and evaluate the implementation of programs and 
projects under this Act. It shall establish a results-based M&E framework 
with clearly defined performance indicators, reporting timelines, and 
mechanisms for tracking beneficiary outcomes, fund utilization, and 
institutional performance.
6. The Council shall conduct periodic impact evaluations to assess the 
relevance, effectiveness, efficiency, and sustainability of the programs 
supported under this Act. These evaluations shall examine social, economic, 
and environmental outcomes, and shall include equity analysis across 
priority sectors such as women, youth, indigenous peoples, and persons 
with disabilities. This shall include efforts to simplify rules and regulations, 
as well as a review of the applicability and relevance of procedural and 
documentary requirements in the registration, financing, and other activities
6


1 
relevant to MSMEs and individual beneficiaries.
2 
7. The Council shall submit to Congress an annual report assessing the
3 
effectiveness and implementation of the programs under this Act. The
4 
report shall include key findings and recommendations based on the
5 
Council's monitoring and evaluation activities. At a minimum, it shall contain
6 
the following:
7 
a. Status of fund utilization and disbursement;
8 
b. Performance metrics, including job creation, enterprise survival
9 
rates, and distribution of support across sectors and priority groups;
10 
c. Analysis of implementation challenges, bottlenecks, and program
11 
outcomes; and
12 
d. Proposed policy, administrative, or iegislative reforms to improve
13 
program efficiency and impact.
14 
All monitoring and evaluation reports, impact evaluation findings, and other
15 
related studies, including those funded wholly or partially through the Pangkabuhayan
16 
Fund, shall be submitted to Congress through the Congressional Oversight Committee
17 
on Sustainable Livelihood and Entrepreneurship Development (COC-SLED) as referred
18 
to under Section 11 for transparency, learning, and policy refinement.
19 
8. The Council shall promulgate guidelines, programs, and operating principles
20 
as may be deemed proper and necessary in the iight of government policies
21 
and objectives of this Act.
22 
9. The Council shall publish Compliance Guidelines, streamlining and
23 
simplifying the rules and regulations on procedural and documentary
24 
requirements for registration, financing, and other activities relevant to the
25 
implementation of the specified programs. The Compliance Guideline shall
26 
be written in plain language or the applicable local dialect. The publication
27 
of each Compliance Guideline shall include the posting of the guide in a
28 
conspicuous location on the website of the concerned agencies, and
29 
distribution of the guide to known industry contacts, such as small entities,
30 
associations, or industry leaders affected by the rule. The Council shall
31 
publish and disseminate the Compliance Guideline within ninety (90) days
32 
from the date of issuance.
7


1 
10.The Council shall develop and adopt transparent, performance-based
2 
eligibility criteria. The eligibility framework shall be reviewed and revised as
3 
may be necessary based on emerging needs, data, and policy directions.
4 
Provided, however, that the framework shall, at the minimum, include the
5 
following priority sectors and enterprise profiles:
6 
a. women-led, youth-led, indigenous peoples, and PWD-led
7 
enterprises;
8 
b. the poorest households and displaced or informal workers seeking to
9 
start or grow entrepreneurial activities; and
10 
c. environmentally sustainable, community-based, or innovation-driven
11 
business models.
12 
11.To support innovation and risk-taking, the Council may endorse the use of
13 
regulatory sandboxes, pilot-testing mechanisms, or innovation challenge
14 
grants to test inclusive business models in coordination with relevant
15 
agencies and regulators.
16 
12.The Council shall conduct research to support women's entrepreneurship
17 
including entrepreneurial behavior, barriers, participation and cessation
18 
rates, discriminatory practices, and contribution to the national economy
19 
and growth. The Council shall provide policy direction towards recognizing
20 
women's propensity and talent in entrepreneurship as well as establish
21 
linkages that will enable more opportunities for women to engage in
22 
entrepreneurship.
23 
13.The Council shall develop, in coordination with the DepEd, TESDA, and
24 
Commission on Higher Education, a course curriculum or training program
25 
in entrepreneurship that will promote entrepreneurial culture and
26 
competence. Entrepreneurship shall be integrated into the curriculum of
27 
educational and training institutions at all levels.
28 
Sec. 7. Establishment of a Sustainable Livelihood and Entrepreneurial
29 
Development Centers. - There shall be established in every rural municipality a
30 
Sustainable Livelihood and Entrepreneurial Development Center (SLED) in accordance
31 
with a national program framework to be developed by the DTI, through the Bureau
32 
of MSME Development (BMSMED), in consultation with the Pangkabuhayan Council.
8


1 
The framework shall consider the socio-economic profiie, iiteracy, employment
2 
conditions, heaith status, market opportunities, local support systems, and availability
3 
of skiils training activities in each community. Priority shali be given to the most
4 
economicaily depressed areas with the highest percentage of disadvantaged and
5 
marginaiized citizens.
6 
Within one (1) year from the effectivity of this Act, at ieast one (1) piiot SLED
7 
shali be estabiished in each region of the country, including the Bangsamoro
8 
Autonomous Region in Muslim Mindanao and the Cordiiiera Administrative Region.
9 
In areas where Go Negosyo Centers are aiready operationai, they shail continue
10 
to function and be reintegrated under the SLED framework, subject to the provisions
11 
and minimum standards of this Act. The SLEDs shail function as local one-stop service
12 
centers for MSMEs and aspiring entrepreneurs, responsibie for: Promoting ease of
13 
doing business; Facilitating access to liveiihood services, financiai assistance, and
14 
training; Serving as physicai and digitai access points for programs of the DTI, DOLE,
15 
TESDA, DOST, DSWD and other impiementing agencies.
16 
The SLEDs may be set up under the auspices of the local government units, or
17 
non-government organizations tapped by DTI, in coordination with DILG, as may be
18 
necessary, to assist in the implementation of this Act.
19 
The SLED shali be assisted by the DOLE by rendering technicai assistance and
20 
training to the personnei of the SLED and shail be supported by officials in encouraging
21 
the participation of residents in the programs and training offered by the SLED. The
22 
DILG, DOH, DOLE, DA, and other government agencies shali gear their programs to
23 
support the activities and actions envisioned and impiemented by the SLED.
24 
The DTI, in coordination with the Pangkabuhayan Council, shall issue guideiines
25 
on the minimum service standards, operational protocols, and performance indicators
26 
for ali SLEDs nationwide. Where practicabie, digital platforms and mobile delivery
27 
modeis shall be adopted to allow remote communities to access SLED services. SLEDs
28 
shali endeavor to enabie virtuai, digitai, and contactless transactions, particuiariy for
29 
applications, registration, and financiai assistance, in coordination with the national
30 
digital infrastructure strategy.
31 
Sec. 8. Capitalization and Funding of the Pangkabuhayan Council. - A
32 
Pangkabuhayan Fund to strengthen iivelihood, entrepreneurial, and/or MSME
9


1 
development and support is hereby established. This Fund, from which grants will be
2 
issued, shall be administered by the Pangkabuhayan Council which shall screen and
3 
approve qualified proposals. Subject to availability of funds, a revolving fund in the
4 
initial amount of One Billion Pesos (Php 1,000,000,000.00) is hereby allocated for the
5 
initial year's implementation of this Act, and such funds necessary for its continuous
6 
and effective implementation shall thereafter be included in the annual General
7 
Appropriations Act.
8 
At least seventy percent (70%) of the Pangkabuhayan Fund shall be allocated
9 
directly to program beneficiaries in the form of grants, co-financing arrangements,
10 
livelihood starter kits, training subsidies, production tools and equipment, shared
11 
service facilities, community-managed enterprises, or other forms of developmental
12 
assistance that build sustainable income-generating capacity. Disbursement shail be
13 
guided by the performance-based eligibility and prioritization criteria adopted by the
14 
Pangkabuhayan Council under Section 6 of this Act. The Council shall issue detaiied
15 
implementing guidelines to ensure transparent, equitable, and outcome-oriented
16 
delivery of this allocation.
17 
The remaining thirty percent (30%) of the Pangkabuhayan Fund shall be
18 
allocated for program administration, digital transformation, monitoring and
19 
evaluation, compliance and reporting systems, and the institutional capacity-building
20 
of implementing entities. This shall include operational support to the SLED Centers
21 
and the Secretariat, and may cover the hiring of plantilla and contractual personnel,
22 
consultants, or other necessary human resources to ensure effective implementation,
23 
oversight, and continuous improvement of programs and services. It may also support
24 
the development and maintenance of digital platforms, beneficiary databases, and
25 
compliance tracking systems, as weil as the conduct of policy research, feasibility
26 
studies, market analyses, and other knowledge-generation activities necessary to
27 
inform program design, improve targeting, and assess the economic, sociai, and
28 
environmental impacts of funded initiatives. Of this amount, not less than three
29 
percent (3%) of the total Pangkabuhayan Fund shall be earmarked and expended
30 
exclusively for monitoring and evaiuation activities, including the conduct of impact
31 
assessments, performance audits, and data analytics, to ensure evidence-based
32 
decision-making and accountability.
10


1 
Subject to the approval of the Pangkabuhayan Council, the allocation for direct
2 
beneficiary support under the seventy percent (70%) portion may be increased by
3 
utilizing portions of the administrative allocation, where warranted by demand,
4 
absorptive capacity, or program expansion needs.
5 
The Council is hereby authorized to enter into co-financing or public-private
6 
collaboration agreements with local government units, cooperatives, development
7 
partners, and accredited private institutions for the implementation of livelihood and
8 
MSME development programs under this Act.
9 
Further, the Pangkabuhayan Council, in coordination with the agencies
10 
concerned, shall explore the possibility of accessing a growing range of biiateral and
11 
muitilateral funds in order to be able to assist in the funding of liveiihood,
12 
entrepreneurial, and/or MSME programs and initiatives. Strategic partnerships and
13 
cooperation between the public and private sectors shall also be encouraged in the
14 
development and implementation of programs and initiatives.
15 
Sec. 9. Mandatory Allocation of Credit Resources for Livelihood Support
16 
Programs and Micro, Small, and Medium Enterprises. - For a period of ten (10) years
17 
from the date of the effectivity of this Act, all lending institutions as defined under
18 
Bangko Sentral ng Piiipinas (BSP) rules, whether public or private, shall set aside at
19 
least ten percent (10%) of their total loan portfolio based on their balance sheet as of
20 
the end of the previous quarter for Micro, Smali and Medium Enterprises, and make it
21 
available for MSME credit or livelihood support programs as herein contemplated.
22 
Compliance with this provision shall include:
23 
The actual extension of ioans to eligibie MSMEs or beneficiaries; or
24 
a. Wholesaie iending to Participating Financiai Institutions (PFIs) for on-
25 
iending to MSMEs; or
26 
b. Purchase/discount of MSMEs receivables; or
27 
c. Extension of loans to MSME value chain actors who ailow MSMEs to
28 
participate in organized or formal value chains. Chain actors include, among
29 
others, traders, suppliers, processors, and aggregators who conduct linked
30 
sequences of value-adding activities involved in bringing a product to finai
31 
consumers.
11


1 
The BSP and the Securities and Exchange Commission (SEC), in consultation
2 
with the Pangkabuhayan Council, shall formulate rules for the effective
3 
implementation of this provision: Provided, That the purchase of government notes,
4 
securities, and other negotiable instruments shall not be deemed compliant with the
5 
foregoing provisions: Provided, further, That the BSP and the SEC, in consultation with
6 
all stakeholders, shall establish a meaningful incentive system to encourage
7 
compliance with this provision; Provided, finaiiy, that the BSP and the SEC shall align
8 
their regulations on penalties for banks and other entities for non-compliance with the
9 
provision for mandatory lending.
10 
The Pangkabuhayan Council shall set up the appropriate systems to monitor all
11 
loan applications of MSMEs to account for the absorptive capacity of the MSME sector.
12 
Each lending institution shall designate a Chief Compliance Officer who will prepare
13 
and sign the report on compliance and noncompliance with the mandatory credit
14 
allocation, for submission to the BSP in the case of banks, and the SEC in the case of
15 
non-bank financial intermediaries.
16 
The BSP in the case of banks, and the SEC in the case of non-bank financial
17 
intermediaries shall furnish to the Pangkabuhayan Council every quarter
18 
comprehensive reports on the lending entity's compliance and noncompliance with the
19 
above provisions on the mandatory credit allocation for MSMEs and beneficiaries, and
20 
shall submit an annual report, signed by an officer with the rank of at least a managing
21 
director, on the amounts of the penalties for non-compliance with the mandatory
22 
lending provision of this act.
23 
All banks shall provide access to deposit accounts, such as savings, checking,
24 
and debit accounts, to registered MSMEs. Financial technology shall be provided to
25 
MSMEs to ensure their financial inclusion.
26 
All lending entities shall report credit information and transactions of MSMEs to
27 
a national credit registry to monitor proper compliance and efficient implementation.
28 
For efficient implementation and operation, cooperatives, except cooperative
29 
banks and insurance cooperatives, shall be under the sole supervision and examination
30 
of the Cooperative Development Authority (CDA); all other financial entities,
31 
corporations and financial intermediaries, such as non-government organizations,
32 
financing companies, non-stock savings and loan associations, microfinance non-
12


1 
government organizations, and lending investors shall be under the SEC; banks shall
2 
be under the BSP; and insurance companies shall be under the Insurance Commission
3 
(IC). For clarity, cooperative banks shall be under the supervision and examination of
4 
the CDA and BSP; while insurance cooperatives shall be under the supervision and
5 
examination of the CDA and Insurance Commission (IC).
6 
Lending institutions that are not qualified to acquire or hold lands of the public
7 
domain in the Philippines shall be permitted to bid and take part in sales of mortgaged
8 
real property in case of judicial or extra-judicial foreclosure, as well as avail of
9 
receivership, enforcement, and other proceedings, solely upon default of a borrower,
10 
and for a period not exceeding five (5) years from actual possession: Provided, That
11 
in no event shall title to the property be transferred to such lending institution. If the
12 
lending institution is the winning bidder, it may, during said five (5) year period,
13 
transfer its rights to a qualified Philippine national, without prejudice to a borrowers
14 
rights under applicable laws.
15 
Sec. 10. Recovery Fund. - Aside from the existing benefits for MSMEs and
16 
eligible entrepreneurs, the Pangkabuhayan Council shall establish a Recovery Fund for
17 
MSMEs and beneficiaries, to be sourced from the Pangkabuhayan Fund, to provide
18 
MSMEs with aid, relief, and recovery interventions for disasters, calamities, epidemics,
19 
or complex emergencies, such as but not limited to, the COVID-19 pandemic.
20 
Sec. 11. Congressional Oversight Committee. - To monitor and oversee the
21 
implementation of this Act, there shall be a Congressional Oversight Committee on
22 
Sustainable Livelihood and Entrepreneurship Development (COC-SLED) composed of
23 
the chairpersons of the Senate Committee on Economic Affairs and the House
24 
Committee on Small Business and Entrepreneurship Development as chairperson and
25 
co-chairperson, respectiveiy; five (5) members of each of the Senate and House of
26 
Representatives to include the chairpersons of the Senate committees on Trade and
27 
Commerce, and Banks, Financial Institutions and Currencies; and the chairpersons of
28 
the House Committees on Trade and Industry, Banks and Financial Intermediaries,
29 
and Appropriations: Provided, That two (2) of the five Senators and two (2) of the five
30 
House members shall be nominated by the respective minority leaders of the Senate
31 
and the House of Representatives.
13


1 
The COC-SLED shall set the guidelines and overall framework for the monitoring
2 
of the implementation of this Act and shall adopt its internal rules of procedure. The
3 
Secretariat of the COC-SLED shall be drawn from the existing personnel of the Senate
4 
and House of Representatives committees comprising the COC-SLED.
5 
A mandatory review of the implementation of this Act shall be conducted five
6 
(5) years from its effectivity. Thereafter, the continued requirement for annual
7 
reporting under this Act may be modified or discontinued upon a determination by
8 
Congress, through a resolution, that the objectives of the Act have been substantially
9 
achieved and that its core functions are sustainably institutionalized.
10 
Sec. 12. Information Dissemination. - The Philippine Information Agency, in
11 
coordination with the DTI and the DILG, shall ensure the proper and adequate
12 
information dissemination of the contents and benefits of this Act to pertinent media
13 
entities and all cities, municipalities, and barangays.
14 
Sec. 13. Considerations in Setting Priority Areas for Sustainable Livelihood and
15 
Entrepreneurship. - In identifying the priority areas for livelihood and
16 
entrepreneurship development, the Pangkabuhayan Council shall, in consultation with
17 
the sectors concerned, consider the following areas:
18 
a. Food security and sustainable agriculture;
19 
b. Regenerative systems;
20 
c. Health;
21 
d. Secure, clean, and reliable energy;
22 
e. Climate change and disaster resilience;
23 
f. Innovation of traditional knowledge, traditional cultural expressions, and
24 
genetic resources;
25 
g. Digital economy;
26 
h. Sustainable transportation services; and
27 
i. Sustainable tourism, among 
others.
28 
Sec. 14. Whole of Government Approach. - In order to effectively promote and
29 
advance sustainable livelihood and entrepreneurship across all areas of government
30 
policy, a "whole of government approach" shall be adopted by all agencies concerned.
31 
This approach shall facilitate engagement with business, the research, development,
32 
and engineering (RD&E) sector, MSMEs, and the broader community towards ensuring
14


1 
the full and effective implementation of this Act.
2 
Sec. 15. Digital Access and Transparency. - To promote transparency,
3 
accountabiiity, and citizen empowerment consistent with open government principies,
4 
the Pangkabuhayan Councii shail ensure that ali reievant information on iivelihood and
5 
MSME programs under this Act is made accessible through a unified online portal
6 
managed in coordination with implementing agencies.
7 
The portai shali provide real-time and comprehensive access to the foliowing:
8 
Information on poiicies, strategies, and programs, inciuding services, grants, training,
9 
and financial assistance; A searchabie database of ongoing and completed initiatives,
10 
project locations, and implementing agencies; M&E reports, impact evaluation results,
11 
and related studies, including those funded under the Pangkabuhayan Fund; Annual
12 
reports submitted to Congress and the COC-SLED; Compliance guidelines and program
13 
application procedures in plain language.
14 
The Council shall ensure that, to the greatest extent practicable:
15 
1. All processes may be initiated, tracked, and completed virtually,
16 
including the online filing of applications and submission of
17 
requirements;
18 
2. Inquiries filed through the portal shall be acknowledged within three (3)
19 
working days;
20 
3. All transactions are assigned a reference number and acknowledgment
21 
receipt for tracking and monitoring purposes;
22 
4. Where feasible, digital and contactless transactions shall be enabled,
23 
including mobile-friendly interfaces 
and integration with government
24 
digital ID systems, e-wallets, and national databases.
25 
Reforms to streamline application procedures and enable virtual processing
26 
shall be reported to the Council within six (6) months from the effectivity of this Act,
27 
and shall be continuously updated thereafter, unless otherwise required by the COC-
28 
SLED.
29 
Sec. 16. Removing Barriers to Livelihood and MSME Support. - The
30 
Pangkabuhayan Council and its member government agencies, in coordination with
31 
ARTA, shall eliminate regulatory barriers and cut red tape to enable access to
32 
livelihood and MSME support programs. Towards this end, the Council shall facilitate
15


1 
consultations with stakeholders to identify and cause the removal of barriers, such as
2 
procedural rules and documentary requirements in registration, access to financing,
3 
or accessing government services.
4 
Sec. 17. Institutional Safeguards and DepoHtidzation. - To ensure fairness,
5 
transparency, and accountabiiity in the use of pubiic resources, the foilowing
6 
safeguards shali be observed:
7 
(a) The Council shall adopt and publish a standardized compliance and eligibility
8 
framework applicable to all beneficiaries, including documentary and
9 
performance requirements;
10 
(b) Political intervention, influence-peddling, or favoritism in the identification,
11 
selection, or implementation of program beneficiaries, training activities,
12 
fund disbursement, or technical assistance 
under 
this Act 
is strictly
13 
prohibited;
14 
(c) All implementing agencies and LGUs shall adhere to non-partisan, rule-
15 
based protocols, and shall maintain complete and auditable records of 
all
16 
program activities.
17 
Sec. 18. Coordination with Existing Bodies. - The Pangkabuhayan Council shall
18 
align its policies and programs with the mandates of existing interagency bodies,
19 
including but not limited to the MSME Development Council (MSMEDC), the Social
20 
Development Committee (SDC), and the National Innovation Council (NIC). All MSME-
21 
specific policy frameworks, including those under the MSMEDC, shall be integrated
22 
and harmonized with the broader sustainable livelihood agenda of the Pangkabuhayan
23 
Council.
24 
Sec. 19. Non-Discrimination. - No individual or group shall be denied access to
25 
the benefits, services, or opportunities under this Act on the basis of gender, age,
26 
ethnicity, religion, disability, civil status, sexual orientation, gender identity or
27 
expression, geographic location, political affiliation, or any other status or condition
28 
that unduly limits participation.
29 
All implementing agencies, partner institutions, and local government units
30 
shall ensure that application, selection, and delivery processes are conducted in a fair,
31 
inclusive, and transparent manner. The Council shall issue guidelines to operationalize
32 
this provision, including grievance mechanisms, monitoring systems, and capacity-
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4
5
6
7
8 
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10
11
12
13
14
15
16
17
18
building for frontline personnel to prevent discrimination and promote inclusive access.
Any official or personnel proven to have engaged in discriminatory practices in 
the implementation of this Act shall be subject to administrative, civil, or criminal 
liability, as may be appropriate under existing laws.
Sec. 20. Implementing Rules and Regulations. - The Secretary of DTI, in 
coordination with all members of the Pangkabuhayan Council, shall formulate the 
necessary rules and regulations to implement the provisions of this Act within ninety 
(90) days after its approval. The rules and regulations issued pursuant to this Section 
shall take effect fifteen (15) days after its publication in a newspaper of general 
circulation.
Sec. 21. Separability Clause. - If any provision of this Act shall be held 
unconstitutional, the remainder of this Act not otherwise affected shall remain in full 
force and effect.
Sec. 22. Repealing Clause. - All laws, executive orders, presidential decrees, 
rules, and regulations, or parts thereof inconsistent with any provisions of this Act are 
hereby repealed, amended, or modified accordingly.
Sec. 23. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation.
Approved,
17