Pondo Sa Pagbabago at Pag-asenso (P3) Act
Filed on July 14, 2025, and referred to the Committees on Trade, Commerce and Entrepreneurship; Economic Affairs; and Finance; it has been pending in committee since April 30, 2026, with no recorded action since then.
The bill addresses the financing challenges faced by a significant portion of the economy.
The bill responds to ongoing financial access issues for MSEs, particularly in the wake of economic challenges.
Pondo Sa Pagbabago at Pag-asenso (P3) Act
The Pondo sa Pagbabago at Pag-asenso (P3) Act aims to promote entrepreneurship by establishing a financing program for micro and small enterprises (MSEs) through the Pondo sa Pagbabago at Pag-asenso Program, which will be implemented by the Small Business Corporation (SBCorp) under the Department of Trade and Industry (DTI).
Compared with current law:
No formal financing program for MSEs.
Establishes a structured financing program for MSEs with accessible loans and cash assistance.
High interest rates from informal lenders.
Caps interest rates at 1% for direct lending and 2.5% for lending through accredited institutions.
Limited support for MSEs post-disasters.
Includes provisions for business recovery assistance after disasters.
The P3 Act, or Pondo sa Pagbabago at Pag-asenso Act, aims to promote entrepreneurship by establishing a financing program for micro and small enterprises (MSEs) through the Pondo sa Pagbabago at Pag-asenso Program.
Source · full text✦ Dashed tags are AI-suggested nuance; solid tags follow the committee taxonomy.
Stalled: The bill has been pending in committee for over five months since the last recorded action on April 30, 2026, when technical working group meetings were conducted.
No floor deliberations yet — this measure has not reached plenary. Its committee-stage actions appear under Legislative history above.
TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session 25 JUL 14 A10:30 SENATE S. No._ 46'7 Introduced by Senator Jinggoy Ejercito Estrada AN ACT PROMOTING ENTREPRENEURSHIP BY INSTITUTIONALIZING A FINANCING PROGRAM FOR MICRO AND SMALL ENTERPRISES THROUGH THE PONDO THEREFOR SA PAGBABAGO AT PAG-ASENSO PROGRAM AND APPROPRIATING FUNDS EXPLANATORY NOTE Data from the Department of Trade and Industry (DTI) show that out of the 1.25 million business enterprises operating around the country, 1,127,058 or 90.43% are micro, 109,912 or 8.82% are small, and 4,763 or 0.38% are medium enterprises. Moreover, MSMEs collectively generated more than 6.35 million jobs or 66.97% of the country's total employment? These figures illustrate the valuable impact of MSMEs to national economic development. The sari-sari stores, backyard farms, home-based bakeries and carinderia energize the domestic economies, provide stable livelihood and income to many Filipinos, and offer opportunities for a better quality of life. A report by the International Finance Corporation from the World Bank Group provides that "inadequate access to finance is identified as the biggest obstacle" to MSMEs' sustainable growth and job creation, topping all other issues such as corruption, infrastructure and taxes. At the ASEAN level, the same constraints are 2 Ibid 1 2023 Philippine MSME Statistics. Accessed through: https://www.dti.gov.ph/resources/msme-statistics/ 3https://www.smefinanceforum.org/sites/default/files/Data%20Sites%20downloads/IFC%20Report _MAIN%20 Final%203%2025.pdf
observed in many jurisdictions, as a regional policy report recommended the provision of direct credit support as a key policy intervention to support SME access to financing*. This measure, which was reported out by the Senate Committee on Trade, Commerce and Entrepreneurship during the 19th Congress, proposes the institutionalization of P3 or the Pondo sa Pagbabago at Pag-asenso Program under the Small Business Corporation (SBCorp) of the DTI. The P3 Program, which was launched in 2017, was conceptualized to provide access to cheap and easy credit for entrepreneurs who want to infuse additional capital or expand their businesses, without voluminous documentary requirements or high-end collaterals. It offers alternative, low-cost interest (not exceeding 2.5% rate per month) micro-financing options to business owners who would otherwise be lured into predatory "5-6" lending schemes or transacting with loan sharks. Through the years, the P3 Program has annually received between P500 million to one billion pesos in the annual General Appropriations Act. For the 2025 budget, P500 million has been appropriated for the program, and provinces with high number of indigents and incidence of poverty, MSMEs of indigenous people and sustainable rural livelihood are given priority. In view of ensuring the continued success and invaluable contribution of MSMEs to attaining inclusive development and prosperity, and eradicating poverty, the passage of this legislation is hereby recommended. JINGGOY EJERCITO ESTRADA * https://asean.org/wp-content/uploads/2024/09/Full-Report ASEAN-SME-Policy-Index-2024 20-Sept- 2024.pdf
W!: TWENTIETH CONGRESS OF THE Note gitt REPUBLIC OF THE PHILIPPINES ) First Regular Session ) 25 JUL 14 A10:30 SENATE S. No. Introduced by Senator Jinggoy Ejercito Estrada AN ACT PROMOTING ENTREPRENEURSHIP BY INSTITUTIONALIZING A FINANCING PROGRAM FOR MICRO AND SMALL ENTERPRISES THROUGH THE PONDO THEREFOR SA PAGBABAGO AT PAG-ASENSO PROGRAM AND APPROPRIATING FUNDS Congress assembled: Be it enacted by the Senate and the House of Representatives of the Philippines in
Section 1. Short Title. - This Act shall be known as the "Pondo sa Pagbabago
at Pag-asenso (P3) Act."
Sec. 2. Declaration of Policy. - It is the declared policy of the State to foster
comprehensive national development and inclusive growth and reduce poverty by promoting the growth of Micro and Small Enterprises (MSEs) which facilitate local job creation, production, and trade in the country. Towards this end, the State shall develop policies, plans, and programs, and initiate means to encourage entrepreneurial activities and ease the constraints and challenges of MSEs, particularly on access to financing.
Sec. 3. Objectives. - The objectives of this Act are:
a) Provide an affordable, accessible, sustainable, and simple financing program for the country's MSEs, especially those in the poorest populations and underserved areas and industries; b) Provide a better alternative to informal lenders or the so-called "5-6" money lending system availed of by MSEs;
c) Reduce the interest rate at which financial services are made available to MSEs; d) Encourage the development of entrepreneurship and the Micro, Small and Medium Enterprise (MSME) sector, particularly MSEs; e) Support successful business recovery of MSEs following natural or man- made disasters; and, f) Provide cash, technical, and administrative assistance to qualified MSEs.
Sec. 4. Pondo sa Pagbabago at Pag-asenso (P3) Program. - The Pondo sa
Pagbabago at Pag-asenso Program, hereinafter referred to as the "P3 Program", shall assist MSEs in the form of: a) microfinance or credit; b) cash assistance; and c) 11 capacity building. Qualified end-borrowers of the P3 Program shall be MSEs defined in Republic Act No. 6977, as amended, or the "Magna Carta for Micro, Small, and Medium Enterprises." The P3 Program shall be accessible through the Small Business Corporation (SBCorp) and through accredited Partner Financial Institutions (PFIs) such as rural banks, thrift banks, cooperatives with a license to lend, microfinance non-government organizations, or lending companies.
Sec. 5. Microfinance or Credit Component of the P3 Program. - The SBCorp and
PFIs shall be guided by the following principles in the implementation of the Microfinance or Credit Component of the P3 program: a) The loanable amount ceiling for individual loans shall be set initially at Two million pesos (Php 2,000,000.00) for direct lending and Three hundred thousand pesos (Php 300,000.00) for lending through accredited PFIs which are regularly reviewed by the Micro, Small and Medium Enterprise Development (MSMED) Council; b) The interest rate shall not exceed one percent (1%) per month for direct lending, and shall not exceed two and a half percent (2.5%) per month for lending through accredited PFIs; c) There shall be no collateral requirement from the P3 Fund borrowers; d) The lenders shall have a collection mechanism, whereby payments are made on a daily, weekly, or monthly basis, depending on the business income
cycle. It shall be the duty of the lender to collect the loan principal and the interest payment from the borrower; and e) Financial technology-enabled systems and processes shall be utilized in the implementation of the P3 Program. Disbursements shall use digital forms of payment for both the disbursement of loan proceeds by the lenders, and the recurring loan payments by the borrowers.
Sec. 6. Lead Implementing Agency. - The SBCorp, as the financing arm of the
Department of Trade and Industry (DTI), shall be the lead implementing agency of the P3 Program. 11 modes: The SCorp shall handle all fund deliveries to MSEs through the following a) Direct lending - The SCorp shall prioritize underserved or unserved areas and industries, or those not adequately and effectively served by PFIs, including provinces where poverty incidence remains high based on official poverty statistics from the Philippine Statistics Authority (PSA); and b) Lending through accredited PFIs. The SCorp may allocate up to five percent (5%) of the total loans disbursed for the period, sourced from the accumulated funding for the P3 Program to cover its annual administrative and operating expenses which shall include the salaries of regular plantilla personnel involved in the implementation of the P3 Program.
Sec. 7. Cash Assistance and Capacity Building Components of the P3 Program.
- The SBCorp, in consultation with the DTI's Bureau of Micro, Small, and Medium Enterprise Development (BMSMED), National Anti-Poverty Commission (NAPC), and the Bangko Sentral ng Pilipinas (BSP), shall develop a cash assistance program exclusively for MSEs in need of capital. The SBCorp shall provide MSEs under the Capacity Building Component with free technical and administrative support, including but not limited to, product development, skills and leadership training, packaging and design, quality control, market promotion, client or supplier matching, and cash literacy and planning. The SCorp shall be guided by the following principles in the implementation of the Cash Assistance and Capacity Building Components of the P3 program:
a) The assistance shall be extended only to beneficiaries who have satisfied the requirements under this Act; b) Each cash assistance shall range from Five thousand pesos (Php 5,000.00) to Fifty thousand pesos (Php 50,000.00), depending on the number of employees, number of years in business, financial hardship, and such other criteria as may be determined by SBCorp. The SBCorp is hereby authorized to adjust these amounts to meet present market demands after the mandatory review provided in this Act; c) Priority shall be given to MSEs classified under the priority business areas of their respective regions, particularly the public market vendors, to strengthen their financial capabilities and improve public services; and d) There shall be a mandatory review of the Cash Assistance and Capacity Building Components of the P3 program every three (3) years to ensure that they meet the present market demands.
Sec. 8. Eligibility for Cash Assistance. - The applicants of the Cash Assistance
must comply with the following eligibility requirements: a) Must be an owner of a registered MSE who is at least eighteen (18) years old; b) Must not have availed of the cash assistance regardless of the number of businesses owned; c) Must be a member in good standing of a duly registered cooperative or association, or a resident of the local government unit (LGU), from which the member intends to avail of the cash assistance; d) The institution shall have a mechanism whereby cash assistance is made on a weekly or monthly basis; e) Must submit a comprehensive feasibility study of the business proposal; f) Must attend a DTI-accredited livelihood seminar, as evidenced by a certificate of participation; and g) Must be willing to state under oath the facts establishing the foregoing.
Sec. 9. Registry of MSEs. - The DTI shall create a registry of all MSMEs per
region based on their size category (i.e., micro, small and medium) and business area (i.e., agriculture, livestock, fisheries, food processing, fabric and clothing, eco-tourism
activities, pottery and handicrafts, furniture and hardwood, information and technology, etc.).
Sec. 10. Policy Oversight Function. - The MSMED Council shall monitor the
implementation of the P3 Program and shall submit an annual report to the President of the Philippines and to Congress, through the Congressional Oversight Committee on Micro, Small and Medium Enterprise Development (COC MSMED) Council.
Sec. 11. Appropriations. - The total amount of Ten billion pesos (Php
10,000,000,000.00) shall be appropriated for the initial implementation of the P3 9 Program for microfinance, cash assistance, and capacity building program upon effectivity of this Act. Thereafter, such sums as may be necessary shall be included in 11 the annual General Appropriations Act.
Sec. 12. Implementing Rules and Regulations. - Within sixty (60) days from the
approval of this Act, the DTI shall formulate and promulgate rules and regulations necessary for its implementation.
Sec. 13. Separability Clause. - If any provision of this Act is declared
unconstitutional, the remainder thereof not otherwise affected shall remain in full force and effect.
Sec. 14. Repealing Clause. - All laws, presidential decrees, executive orders,
letters of instruction, proclamations or administrative regulations that are inconsistent with the provisions of this Act are hereby repealed, amended, or modified accordingly.
Sec. 15. Effectivity. - This Act shall take effect after fifteen (15) days following
its publication in the Official Gazette or in a newspaper of general circulation. Approved,
Reproduced from the Senate document. The official PDF is the authoritative version.