Micro, small and medium enterprises comprise 99.58 percent of all businesses in the Philippines and employ 64.67 percent of the entire workforce. These businesses, which include small community stores or sari-sari stores, water refilling stations, laundry stations and many others, not only contribute to the country’s GDP but also provide essential services to the local communities.
Such is the outsized importance of MSMEs that the United Nations designated June 27 as International MSME Day to raise awareness on their immense contributions to the UN Sustainable Development Goals. These enterprises play a pivotal role in driving local and national economies while also supporting the livelihoods of the working poor, women, youth, and vulnerable groups.
A recent survey by Philippine research firm OCTA Research showed that 81 percent of adult Filipinos want to be entrepreneurs. This desire to start their own businesses reflects the recognition of the opportunities and potential that MSMEs offer, not only in terms of economic growth but also in empowering individuals and communities.
Igloo, the first full-stack insurtech firm to emerge from Singapore, shares tips on how entrepreneurs can get started in the Philippines.
The first step of every aspiring entrepreneur is deciding what kind of business to open and where to open a physical storefront. It’s essential to conduct thorough research whether there’s a market for the product or service, enough foot traffic and if the location is appropriate for it.
Aspiring entrepreneurs can also explore a hybrid phygital (a portmanteau of physical and digital) setup including offering online payments or e-commerce options to widen reach and market.
Second, once an entrepreneur decided on the business and where to open it, it is time to obtain necessary documentation and permits. In the Philippines, businesses are required to register with the Department of Trade and Industry, if they’re a sole proprietorship, or with the Securities and Exchange Commission if it’s a partnership or a corporation.
Businesses also need to get a mayor’s permit or municipal license from the city or municipality where the establishment is located. They also need to register with the Bureau of Internal Revenue to ensure proper taxation.
If they plan on employing other people to help run the business, registrations with other government agencies such as the Department of Labor and Employment and Social Security System are also required.
This may seem like a lot of steps but these registrations and permits ensure that they are able and willing to run business properly and legally by following applicable laws and regulations.
Beyond securing the location and required permits, an important step when it comes to running a business is to protect the business from any unwanted incidents including injuries, burglaries and accidents.
This is where small business insurance like NegosyoCare comes in. Created by regional insurtech Igloo in partnership with Malayan Insurance and GCash, NegosyoCare is an insurance product specifically designed to protect MSMEs.
“MSMEs are the backbone of the economy, but they often run on tight budgets and have limited access to financing. This puts them at risk when unexpected events come knocking and disrupt their operations. That’s why having small business insurance, like NegosyoCare, is so important. It offers affordable and accessible coverage, giving these businesses the protection they need without breaking the bank,” said Igloo Philippines country manager Mario Berta.
Available via GCash’s GInsure marketplace, NegosyoCare premiums begin at P160 for one-month coverage and up to P525 for one-year coverage. It provides coverage for accidental deaths, total permanent disability due to accident and disablement or dismemberment due to accident for up to P50,000.
Benefits also include medical reimbursement for accidents for up to P5,000, fire cash assistance for P10,000, and coverage for burglary and housebreaking for P10,000.
“These tips only scratch the surface of what it takes to run a business in the Philippines, but by taking these steps, aspiring entrepreneurs can set themselves up for success and remember: protect your small business with NegosyoCare, available at the GCash GInsure Marketplace,” Igloo said.
Igloo has offices in Singapore, Indonesia, Thailand, the Philippines, Vietnam and Malaysia and tech centers in China and India. With a mission of making insurance accessible for all, the firm leverages big data, real-time risk assessment and end-to-end automated claims management to create B2B2C insurance solutions for platform companies and insurance companies.
Igloo’s insurance solutions enable companies to eliminate their exposure to operational risk, create new revenue streams, and optimize and enhance existing products and services.