Pangkabuhayan Act of 2025

TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES 25 1JL -7 A9:28 First Regular Session SENATE S. No. 160 Introduced by Senator Loren Legarda AN ACT TO PROMOTE AND ADVANCE SUSTAINABLE LIVELIHOOD AND ENHANCING, AND ENTREPRENEURSHIP BY INTEGRATING, 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,' 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 Retrieved June 26, 2025, from: PSA (2023) https://rsso02.psa.gov.ph/system/files/attachment-dir/2025R0215-SR004%202023%20Ful%20Ye ar%20Poverty%20Statistics.pdf

14%, with a Gini index around 40—means the poorest have limited resources and opportunity to escape poverty.? Micro, Small, and Medium Enterprises (MSMEs) comprise 99.5% of business establishments in the Philippines 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). 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. 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. Other challenges, including the ongoing effects of climate change, Retrieved June 26, 2025, from: World Bank (2022). https://www.worldbank.org/en/news/press-release/2022/11/24/ph-reducina-ineauality-kev-to-bec @ming-a-middle-class-society-free-of-poverty#:~;text=Yet%20inequality%20remains%20high: %2 Othe,income%20inequalitу%20in%20East%20Asia Retrieved June 26, 2025, from: DTI. https://www.dti.gov.ph/resources/msme-statistics/ Retrieved June 26, 2025, from: MSME Sector is Key to COVID Inclusive Recovery for the Philippines. https://www.ph.undp.org/content/philippines/en/home/presscenter/pressreleases/202-/msme-sec tor-is-key-to-covid-19-inclusive-recovery-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.org/sites/default/files/publication/677321/adbi-wpl216.pdf Ibid. Retrieved June 26, 2025, from: MSMEs: Key to an inclusive and sustainable recovery: https://www.un.org/en/observances/micro-small-medium-businesses-day.

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.® 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 25 JUL -7 19:29 First Regular Session SENATE S. No. _ Introduced by Senator Loren Legarda 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:

Section. 1. Short Title. - This Act shall be known as the "Pangkabuhayan Act

2 of 2025."

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 reduction, and enhancement of the quality of life for all, especially the underprivileged. Consistent with the aforestated policy, the State shall: and encourage sustainable livelihoods, (a) Promote, strengthen, entrepreneurship, and the growth and development of MSMEs in all productive sectors of the economy, particularly rural, agri-based enterprises, research and development, invention, innovation, cultural and creative industries, and other careers that contribute to environmental and cultural preservation;

(b) Harmonize and strengthen the implementation of existing MSME laws, social legislation, and livelihood and poverty alleviation programs to promote sustainable production, develop skills and capabilities, expand access to financial services and resource support, improve information flow and market access, foster value chain participation, and create greater opportunities for economic empowerment and increased incomes; (c) Adopt livelihood, entrepreneurial, and/or MSME development and support that is holistic, comprehensive, integrated, people-centered, responsive, and participatory, in lessening the socioeconomic and environmental impacts of disasters including epidemics and climate change, and promoting the involvement and participation of all sectors and all stakeholders concerned, at all levels, especially the local community; (d) Institutionalize the policies, structures, coordination mechanisms, and programs with continuing budget appropriation from national down to local levels towards building economic empowerment and improved incomes; (e) Simplify and minimize procedural rules and documentary requirements in the act of registration, availing of financing, or accessing government services; (f) Complement and supplement financing programs to remove stringent and burdensome collateral requirements; (g) Engage the participation of the beneficiaries, especially the poor and vulnerable, in the design, development, and implementation of sustainable livelihood policies or programs; (h) Engage the participation of civil society organizations (CSOs) and the private sector in the government's livelihood development and support for MSMES programs towards complementation of resources and effective delivery of services to the citizenry; and (i) Assure a balanced and sustainable development through the establishment of a feedback and evaluation mechanism that will monitor socio-economic contributions as well as bottlenecks and environmental effects.

Sec. 3. Scope. - This Act provides for the development of policies and plans

and the implementation of actions and measures pertaining to all aspects of

1 sustainable livelihood development and support and the growth and development of MSMES.

Sec. 4. The Pangkabuhayan Council. - The Pangkabuhayan Council is hereby

established to develop the country's sustainable livelihood and entrepreneurship goals, priorities, and long-term national strategy. The Council shall mainstream principles that are integrated, people-centered, participatory, responsive, and sustainable in the 7 development, implementation, and assessment of sustainable livelihood and entrepreneurial programs and strategies.

Sec. 5. Composition of the Pangkabuhayan Council. - The Council shall be

composed of the following members: (a) President of the Philippines as the Chairperson; (b) Secretary of the Department of Trade and Industry (DTI) as the Vice- Chairperson; (c) Secretary of the Department of Economy, Planning, and Development (DEPDev); (d) Secretary of the Department of Agriculture (DA); (e) Secretary of the Department of Environment and Natural Resources (DENR); (f) Secretary of the Department of Labor and Employment (DOLE); (g) Secretary of the Department of Tourism (DOT); (h) Secretary of the Department of Social Welfare and Development (DSWD); (i) Secretary of the Department of Science and Technology (DOST); (i) Chairperson of the Commission on Higher Education (CHED); (k) Secretary of the Department of Budget and Management (DBM); (1) Secretary of the Department of Education (DepEd); (m) Secretary of the Department of Interior and Local Government (DILG); (n) Director-General of the Intellectual Property Office of the Philippines (IPOPHIL); and (o) Seven (7) Executive Members are to be appointed by the President. The Executive Members shall be appointed from the ranks of business, entrepreneurs, academe, and the scientific community, at least one (1) of whom shall be a woman. There shall be at least one (1) representative from the MSME sector.

1 Those to be appointed from the academe and the scientific community shall have at least seven (7) years of experience in the field of science and technology, research and development, or innovation. The President may designate the Executive Secretary to attend on his behalf and preside over the meetings of the Pangkabuhayan Council. The Department Secretaries and other members may not designate alternate representatives other than their respective undersecretaries to the meetings. The majority of the members shall constitute a quorum. The DTI shall designate one of its existing units as the lead Secretariat for the Pangkabuhayan Council. The DTI Secretary may establish a dedicated unit or designate an inter-staff team to support the Council's coordination, monitoring, and programmatic functions. Subject to a review of workload, implementation performance, and budgetary availability, the DTI may propose to the DBM the creation of a dedicated Livelihood and Entrepreneurship Policy Office within DTI to serve as the permanent Secretariat for the Pangkabuhayan Council with corresponding plantilla positions and budget.

Sec. 6. Powers and Functions. - The Pangkabuhayan Council shall have the

following powers and functions: 1. The Council shall act as the primary coordinating and supervising body for all national government agencies and instrumentalities involved in the design, implementation, evaluation, and enhancement of programs that promote sustainable livelihood and inclusive entrepreneurship. The Council shall ensure the integration, harmonization, and alignment of these programs with the national strategy for poverty reduction, economic empowerment, and innovation-led enterprise development. 2. At all times, the Council shall safeguard the integrity and targeting of support by ensuring that interventions provided to beneficiaries are aligned with their actual needs, qualifications, and development potential. Beneficiaries shall be guided to access the most suitable forms of assistance, whether financial, non-financial, or a combination thereof, based on transparent assessments, not on personal preference or perceived entitlement to multiple benefits. To this end, Sustainable Livelihood and

Entrepreneurial Development (SLED) Centers under Section 7 of this Act shall serve as the primary local facilitation hubs, providing accessible, user- friendly, and needs-responsive guidance to ensure that beneficiaries are matched with appropriate programs efficiently and with minimal burden. The system shall be designed to simplify procedures, reduce transaction costs, and promote informed decision-making among applicants and program implementers alike. 3. The Council shall coordinate the implementation and policy alignment of the following programs and initiatives, among others: a. DTIs 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 low-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 livelihood projects destroyed due to natural and human-made disasters, or transform existing livelihood 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 technological 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 skills training centers offered by the National Government are properly implemented at the municipal level.

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

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

10. The Council shall develop and adopt transparent, performance-based eligibility criteria. The eligibility framework shall be reviewed and revised as may be necessary based on emerging needs, data, and policy directions. Provided, however, that the framework shall, at the minimum, include the following priority sectors and enterprise profiles: a. women-led, youth-led, indigenous peoples, and PWD-led enterprises; b. the poorest households and displaced or informal workers seeking to start or grow entrepreneurial activities; and c. environmentally sustainable, community-based, or innovation-driven business models. 11. To support innovation and risk-taking, the Council may endorse the use of regulatory sandboxes, pilot-testing mechanisms, or innovation challenge grants to test inclusive business models in coordination with relevant agencies and regulators. 12. The Council shall conduct research to support women's entrepreneurship including entrepreneurial behavior, barriers, participation and cessation rates, discriminatory practices, and contribution to the national economy and growth. The Council shall provide policy direction towards recognizing women's propensity and talent in entrepreneurship as well as establish linkages that will enable more opportunities for women to engage in entrepreneurship. 13. The Council shall develop, in coordination with the DepEd, TESDA, and Commission on Higher Education, a course curriculum or training program in entrepreneurship that will promote entrepreneurial culture and competence. Entrepreneurship shall be integrated into the curriculum of educational and training institutions at all levels.

Sec. 7. Establishment of a Sustainable Livelihood and Entrepreneurial

Development Centers. - There shall be established in every rural municipality a Sustainable Livelihood and Entrepreneurial Development Center (SLED) in accordance with a national program framework to be developed by the DTI, through the Bureau of MSME Development (BMSMED), in consultation with the Pangkabuhayan Council.

1 The framework shall consider the socio-economic profile, literacy, employment 2 conditions, health status, market opportunities, local support systems, and availability 3 of skills training activities in each community. Priority shall be given to the most economically depressed areas with the highest percentage of disadvantaged and marginalized citizens. Within one (1) year from the effectivity of this Act, at least one (1) pilot SLED 7 shall be established in each region of the country, including the Bangsamoro Autonomous Region in Muslim Mindanao and the Cordillera Administrative Region. In areas where Go Negosyo Centers are already operational, they shall continue to function and be reintegrated under the SLED framework, subject to the provisions and minimum standards of this Act. The SLEDs shall function as local one-stop service centers for MSMEs and aspiring entrepreneurs, responsible for: Promoting ease of doing business; Facilitating access to livelihood services, financial assistance, and training; Serving as physical and digital access points for programs of the DTI, DOLE, TESDA, DOST, DSWD and other implementing agencies. The SLEDs may be set up under the auspices of the local government units, or non-government organizations tapped by DTI, in coordination with DILG, as may be necessary, to assist in the implementation of this Act. The SLED shall be assisted by the DOLE by rendering technical assistance and training to the personnel of the SLED and shall be supported by officials in encouraging the participation of residents in the programs and training offered by the SLED. The DILG, DOH, DOLE, DA, and other government agencies shall gear their programs to support the activities and actions envisioned and implemented by the SLED. The DTI, in coordination with the Pangkabuhayan Council, shall issue guidelines on the minimum service standards, operational protocols, and performance indicators for all SLEDs nationwide. Where practicable, digital platforms and mobile delivery models shall be adopted to allow remote communities to access SLED services. SLEDs shall endeavor to enable virtual, digital, and contactless transactions, particularly for applications, registration, and financial assistance, in coordination with the national digital infrastructure strategy.

Sec. 8. Capitalization and Funding of the Pangkabuhayan Council. - A

Pangkabuhayan Fund to strengthen livelihood, entrepreneurial, and/or MSME

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

Subject to the approval of the Pangkabuhayan Council, the allocation for direct beneficiary support under the seventy percent (70%) portion may be increased by utilizing portions of the administrative allocation, where warranted by demand, absorptive capacity, or program expansion neeas. The Council is hereby authorized to enter into co-financing or public-private collaboration agreements with local government units, cooperatives, development partners, and accredited private institutions for the implementation of livelihood and MSME development programs under this Act. Further, the Pangkabuhayan Council, in coordination with the agencies concerned, shall explore the possibility of accessing a growing range of bilateral and multilateral funds in order to be able to assist in the funding of livelihood, entrepreneurial, and/or MSME programs and initiatives. Strategic partnerships and cooperation between the public and private sectors shall also be encouraged in the development and implementation of programs and initiatives.

Sec. 9. Mandatory Allocation of Credit Resources for Livelihood Support

Programs and Micro, Small, and Medium Enterprises. - For a period of ten (10) years from the date of the effectivity of this Act, all lending institutions as defined under Bangko Sentral ng Pilipinas (BSP) rules, whether public or private, shall set aside at least ten percent (10%) of their total loan portfolio based on their balance sheet as of the end of the previous quarter for Micro, Small and Medium Enterprises, and make it available for MSME credit or livelihood support programs as herein contemplated. Compliance with this provision shall include: The actual extension of loans to eligible MSMEs or beneficiaries; or a. Wholesale lending to Participating Financial Institutions (PFIs) for on- lending to MSMEs; or b. Purchase/discount of MSMEs receivables; or C. Extension of loans to MSME value chain actors who allow MSMEs to participate in organized or formal value chains. Chain actors include, among others, traders, suppliers, processors, and aggregators who conduct linked sequences of value-adding activities involved in bringing a product to final consumers.

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

1 government organizations, and lending investors shall be under the SEC; banks shall 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 the CDA and BSP; while insurance cooperatives shall be under the supervision and 5 examination of the CDA and Insurance Commission (IC). 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 real property in case of judicial or extra-judicial foreclosure, as well as avail of receivership, enforcement, and other proceedings, solely upon default of a borrower, and for a period not exceeding five (5) years from actual possession: Provided, That in no event shall title to the property be transferred to such lending institution. If the lending institution is the winning bidder, it may, during said five (5) year period, transfer its rights to a qualified Philippine national, without prejudice to a borrower's rights under applicable laws.

Sec. 10. Recovery Fund. - Aside from the existing benefits for MSMEs and

eligible entrepreneurs, the Pangkabuhayan Council shall establish a Recovery Fund for MSMEs and beneficiaries, to be sourced from the Pangkabhayan Fund, to provide MSMEs with aid, relief, and recovery interventions for disasters, calamities, epidemics, or complex emergencies, such as but not limited to, the COVID-19 pandemic.

Sec. 11. Congressional Oversight Committee. - To monitor and oversee the

implementation of this Act, there shall be a Congressional Oversight Committee on Sustainable Livelihood and Entrepreneurship Development (COC-SLED) composed of the chairpersons of the Senate Committee on Economic Affairs and the House Committee on Small Business and Entrepreneurship Development as chairperson and co-chairperson, respectively; five (5) members of each of the Senate and House of Representatives to include the chairpersons of the Senate committees on Trade and Commerce, and Banks, Financial Institutions and Currencies; and the chairpersons of the House Committees on Trade and Industry, Banks and Financial Intermediaries, and Appropriations: Provided, That two (2) of the five Senators and two (2) of the five House members shall be nominated by the respective minority leaders of the Senate 31 and the House of Representatives.

The COC-SLED shall set the guidelines and overall framework for the monitoring 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 and House of Representatives committees comprising the COC-SLED. A mandatory review of the implementation of this Act shall be conducted five (5) years from its effectivity. Thereafter, the continued requirement for annual reporting under this Act may be modified or discontinued upon a determination by Congress, through a resolution, that the objectives of the Act have been substantially achieved and that its core functions are sustainably institutionalized.

Sec. 12. Information Dissemination. - The Philippine Information Agency, in

11 coordination with the DTI and the DILG, shall ensure the proper and adequate information dissemination of the contents and benefits of this Act to pertinent media entities and all cities, municipalities, and barangays.

Sec. 13. Considerations in Setting Priority Areas for Sustainable Livelihood and

Entrepreneurship. - In identifying the priority areas for livelihood and entrepreneurship development, the Pangkabuhayan Council shall, in consultation with the sectors concerned, consider the following areas: a. Food security and sustainable agriculture; b. Regenerative systems; c. Health; d. Secure, clean, and reliable energy; e. Climate change and disaster resilience; f. Innovation of traditional knowledge, traditional cultural expressions, and genetic resources; g. Digital economy; h. Sustainable transportation services; and i. Sustainable tourism, among others.

Sec. 14. Whole of Government Approach. - In order to effectively promote and

advance sustainable livelihood and entrepreneurship across all areas of government policy, a "whole of government approach" shall be adopted by all agencies concerned. This approach shall facilitate engagement with business, the research, development, and engineering (RD&E) sector, MSMEs, and the broader community towards ensuring

1 the full and effective implementation of this Act.

Sec. 15. Digital Access and Transparency. - To promote transparency,

3 accountability, and citizen empowerment consistent with open government principles, 4 the Pangkabuhayan Council shall ensure that all relevant information on livelihood and MSME programs under this Act is made accessible through a unified online portal managed in coordination with implementing agencies. The portal shall provide real-time and comprehensive access to the following: Information on policies, strategies, and programs, including services, grants, training, 9 and financial assistance; A searchable database of ongoing and completed initiatives, project locations, and implementing agencies; M&E reports, impact evaluation results, and related studies, including those funded under the Pangkabuhayan Fund; Annual reports submitted to Congress and the COC-SLED; Compliance guidelines and program application procedures in plain language. The Council shall ensure that, to the greatest extent practicable: 1. All processes may be initiated, tracked, and completed virtually, including the online filing of applications and submission of requirements; 2. Inquiries filed through the portal shall be acknowledged within three (3) working days; 3. All transactions are assigned a reference number and acknowledgment receipt for tracking and monitoring purposes; 4. Where feasible, digital and contactless transactions shall be enabled, including mobile-friendly interfaces and integration with government digital ID systems, e-wallets, and national databases. Reforms to streamline application procedures and enable virtual processing shall be reported to the Council within six (6) months from the effectivity of this Act, and shall be continuously updated thereafter, unless otherwise required by the COC- SLED.

Sec. 16. Removing Barriers to Livelihood and MSME Support. - The

Pangkabuhayan Council and its member government agencies, in coordination with ARTA, shall eliminate regulatory barriers and cut red tape to enable access to livelihood and MSME support programs. Towards this end, the Council shall facilitate

consultations with stakeholders to identify and cause the removal of barriers, such as procedural rules and documentary requirements in registration, access to financing, or accessing government services.

Sec. 17. Institutional Safeguards and Depoliticization. - To ensure fairness,

transparency, and accountability in the use of public resources, the following safeguards shall be observed: (a) The Council shall adopt and publish a standardized compliance and eligibility framework applicable to all beneficiaries, including documentary and performance requirements; (b) Political intervention, influence-peddling, or favoritism in the identification, selection, or implementation of program beneficiaries, training activities, fund disbursement, or technical assistance under this Act is strictly prohibited; (c) All implementing agencies and LGUs shall adhere to non-partisan, rule- based protocols, and shall maintain complete and auditable records of all program activities.

Sec. 18. Coordination with Existing Bodies. - The Pangkabuhayan Council shall

align its policies and programs with the mandates of existing interagency bodies, including but not limited to the MSME Development Council (MSMEDC), the Social Development Committee (SDC), and the National Innovation Council (NIC). All MSME- specific policy frameworks, including those under the MSMEDC, shall be integrated and harmonized with the broader sustainable livelihood agenda of the Pangkabuhayan Council.

Sec. 19. Non-Discrimination. - No individual or group shall be denied access to

the benefits, services, or opportunities under this Act on the basis of gender, age, ethnicity, religion, disability, civil status, sexual orientation, gender identity or expression, geographic location, political affiliation, or any other status or condition that unduly limits participation. All implementing agencies, partner institutions, and local government units shall ensure that application, selection, and delivery processes are conducted in a fair, inclusive, and transparent manner. The Council shall issue guidelines to operationalize this provision, including grievance mechanisms, monitoring systems, and capacity-

1 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 8 (90) days after its approval. The rules and regulations issued pursuant to this Section 9 shall take effect fifteen (15) days after its publication in a newspaper of general 10 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,