Lawmakers urged to pass social enterprise bill to ease funding constraints, says advocate

Philippine lawmakers are being urged to enact the Poverty Reduction Through Social Entrepreneurship (PRESENT) Act, a measure aimed at helping social enterprises overcome persistent financial access challenges, an advocate said on Wednesday.

Marie Lisa M. Dacanay, founding president of the Institute for Social Entrepreneurship in Asia (ISEA), said the proposed measure would significantly benefit social enterprises, the majority of which are micro, small, and medium enterprises (MSMEs).

She noted that many of these enterprises struggle to secure financing from traditional financial schemes due to a lack of collateral.

According to a 2019 Asian Development Bank (ADB) report, around 70% of the 164,473 social enterprises in the country are considered MSMEs.

Under the proposed PRESENT Act, Ms. Dacanay said funding would become more accessible through measures such as non-collateralized loans and a government-supported guarantee fund pool.

“We are also advocating for grants so that social enterprises have the capacity to engage the poor and build their capability to become active participants in the social enterprise value chain,” she told BusinessWorld on the sidelines of the second day of Inoblasyon: The UP Innovation Summit 2026.

One Senate version, Senate Bill No. 734, introduced by Senator Francis N. Pangilinan, seeks to establish a national program providing incentives such as tax exemptions, preferential treatment in government procurement, and the creation of a Social Enterprise Guarantee Fund Pool (SEGFP) to mitigate risks for lenders.

The measure also promotes hybrid financing or a combination of grants and loans, and institutionalizes capability-building support through technical, consultancy, and advisory services to help marginalized sectors transition into active stakeholders in the formal economy.

Under the bill, a social enterprise is defined as a mission-driven organization that creates wealth while contributing to social well-being and ecological sustainability. These enterprises may take various legal forms, including non-stock, non-profit corporations, cooperatives, and sole proprietorships.

Ms. Dacanay also highlighted a provision on government investment in economic subsector development, which aims to identify areas where poor communities are concentrated and can become major economic players.

She added, this strategic support targets broader value chains to scale up impact by assisting thousands of marginalized producers rather than focusing on isolated small enterprises.

“For example, if you look at an economic subsector in one area, you can be impacting 2,000 farmers such as coconut or rice farmers, rather than just one enterprise with ten workers,” the staunch advocate said.

By enacting the bill, Ms. Dacanay said the poverty sector stands to benefit the most.

As of this writing, several versions of the PRESENT Act have been filed in the Senate and remain pending at the committee level. Its counterpart, House Bill No. 1250, is also pending in the House committee level.

Ms. Dacanay expressed hope that lawmakers will include the measure among their priority bills and pass it within the year or before the end of the current administration’s term. — Edg Adrian A. Eva