Wednesday, December 10, 2014
REP. PAEZ'S BILL ON CSF CO-OPS GETS OK
The Banks and Financial Intermediaries Committee of the House of Representatives has approved HB 278, filed by COOP-NATCCO Party List Rep. CRESENTE C. PAEZ, during the Committee's Dec. 2, 2014 meeting.
CREDIT SURETY FUNDS
Rep. Paez said the bill was in response to the need to institutionalize and legalize Credit Surety Funds (CSFs), which are already functional.
Bangko Sentral ng Pilipinas (BSP) Deputy Governor for Monetary Stability Sector, Diwa Gunigundo expressed his full support for the bill, saying that it would address two impediments to full access to bank credit by small entrepreneurs, namely, lack of credit information or track record, and lack of property that can be collateralized.
To further improve the bill, Gunigundo suggested that the Cooperative Development Authority (CDA) should be made the supervisory body of the CSF cooperatives rather than the BSP, consistent with their respective charters.
HB 278 TO BE EXEMPTED
FROM INSURANCE CODE
He also suggested that the proposed law should clearly state the CSF is excluded from the coverage of Insurance Code. The House Committee agreed to put the CSFs under the supervision of the CDA.
Lawyer Mona Lisa Amba of the CDA initially expressed opposition to HB 278, saying that the provisions run counter to the provisions of the Cooperative Code of the Philippines.
However, after the Committee and the BSP explained that the bill will cure the flaws of the law and further enhance the capacity of the CDA to serve the grassroots borrowers, Amba committed to re-examine the CDA's position and support the bill.
Source: Report published in the House of Representatives' Committee Daily Bulletin, Vol. II, No. 56, Dec. 2, 2014. Visit www.congress.gov.ph/download/commdaily/CDBNolIINo.56 (12.02.2014).pdf