Question & AnswerQ&A (Republic Act No. 1292)
The main purpose is to encourage Filipino retailers and to create the Filipino Retailers' Fund to provide credit facilities for promoting and developing the Filipino retail trade.
The Filipino Retailers' Fund is administered by the Secretary of Commerce and Industry or any other office designated by the President, with provincial, city, and municipal treasurers as deputies.
Importers of prime commodities must sell at least 30% of their imports to Filipino retailers at the same mark-up as their current trade channels.
The Fund can be used as a guarantee fund or as a loan fund, but not more than 20% of the Fund should be given as cash loans.
Filipino citizens who fully own and personally manage retail stores or Filipino citizens who wish to become retailers are eligible to apply for loans not exceeding five thousand pesos.
Loans are payable in five equal annual installments with an interest rate of 4% per annum. Interest cannot be collected in advance, and the retail store's assets must be mortgaged to secure the loan.
The application must state that the retailer is of good moral character and has not been convicted of estafa or crimes involving moral turpitude, and that the loan proceeds will be used solely for purchasing articles for retail sale directly to the public.
Using the loan proceeds for other purposes is unlawful and grounds for contract rescission, making the remaining loan balance and interest immediately due and payable.
The Secretary issues necessary rules and regulations, provides technical assistance to Filipino retailers without cost, and ensures the stable and orderly management of the Filipino Retailers' Fund.
Twenty million pesos are appropriated from the National Treasury to constitute the revolving fund, and all income or receipts from this fund are reinvested to support the Act's purpose.
A guidance division in the Department of Commerce and Industry was created to process loans and assist borrowers in making purchases efficiently.