TO provide the micro, small, and medium enterprise (MSME) sector in Cebu an organized market for business financing and enterprise support linkages, the Cebu Provincial Government set up the country’s first MSME Exchange.

Called Growth Enterprise Market (GEM), the program is designed to be a “nurturing ground” for “unlistable” MSMEs, enabling them to become “listable” in the Philippine Stock Exchange (PSE) Small and Medium Enterprise (SME) Board.

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“The (selected) MSMEs for the program will hopefully become the San Miguel Corp., the Philippine Long Distance Telephone Co. (PLDT) or the Globe Telecom of the future and become models in their own industries,” said Jose Fernando Alcantara, head of GEM’s technical management group (TMG) that is composed of public and private sector representatives.

GEM, an offshoot of the Provincial Government’s Countryside Enterprise and Business Upliftment program, was created in compliance to the newly amended 2008 Philippine Magna Carta for MSMEs.

Alcantara, a former PSE executive, said establishing the facility is the first stage of the plan to make Cebu the center of SME development in the country and in entire Asia.

Support

GEM provides MSMEs financing opportunities—equipment loan, market expansion loan and product development loan—as well as “automated and monitored” enterprise linkages that matches market and supply, product or service development, human resource and governance development.

Initially, though, only 12 MSMEs can be part of the program’s six-month cycle. The MSMEs will have to undergo a selection process, said Alcantara.

“This facility is organized, sustained, and industry-focused.

We provide a facility where providers and users meet and we have a system through which we create batches of scholars or 12 MSMEs every six months. This (size) is strategic and monitorable,” he said.

He added that GEM will cater to around four start-up and eight grown-up MSMEs per batch.

GEM was unveiled Thursday night at the Provincial Capitol Social Hall but its operation will be launched in the last quarter of the year.

Roadmap

“GEM will provide the roadmap to professionalize the businesses of our MSMEs by linking them to capital and opening up new markets for them. The goal here is to assist them in growing from a seed to a full-grown tree,” said Cebu Gov. Gwendolyn Garcia.

The Cebu GEM TMG will make available a website for the program and mobilize the local government units and chambers of commerce while accepting and screening applicants.

The selection criteria, Alcantara said, will cover business evaluation, strategic potential, current potential, entrepreneurial psyche of owner, creditability and industry representation.

He said possible problems may occur during the program, such as borrowers going on default. He assured, though, that the selection process is a safety net by itself, in addition to the integration of the Bangko Sentral ng Pilipinas (BSP)-initiated program called Credit Surety Fund (CFS) into Gem.

Under CSF, the GEM business financing provided by organized financial entities is collateral-free. Lenders can rediscount 80 percent of their portfolio to BSP.

GEM graduates will then move to the next stage where they get an automated host and are matched with capital markets for MSMEs.

Alcantara pointed out that while GEM is different from PSE, it is designed to be “complementary.”

The unveiling of the program also sealed the covenant of partnership and support among the Cebu Provincial Government, Cebu Rural Bankers’ Federation, Cebu Chamber of Commerce and Industry, Mandaue Chamber of Commerce and Industry, Mactan Island Chamber of Commerce and Industry, Cebu Filipino-Chinese Chamber of Commerce and Industry, and PLDT SME Nation.