MSME loans rise in 2025, still lag

Banks' loans to micro, small, and medium enterprises (MSMEs) increased by 5.2 percent to P575 billion by the end of December 2025, a figure still seen as providing limited financing opportunities for the segment.

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The latest data from the Bangko Sentral ng Pilipinas (BSP) showed that total loans to MSMES reached P574.8 billion as of the fourth quarter of 2025, higher than the P546.2 billion recorded in the same period the previous year.

This amount accounted for 4.7 percent of the country's P12.14-trillion banking industry lending portfolio, remaining well below the prescribed ratio of 10 percent.

Banks are encouraged to set aside eight percent of their lending portfolio for micro and small enterprises (MSES), while two percent must be allocated to medium-sized enterprises.

Broken down, loans disbursed to MSES stood at P238.5 billion during the fourth quarter. This was equivalent to two percent of the total loan book, falling short of the prescribed eight-percent ratio.

BSP figures indicate that lenders should have set aside a minimum of P971.5 billion for MSES.

Notably, the fourth-quarter figure was 5.9 percent higher than the previous quarter's level of P225.2 billion.