This dissertation studies the aspects of Micro Finance Institution in the Luzon region of Philippines, their impact on increasing Micro Entrepreneurship through Government and Non–Government organisation, based on a specially designed survey in selected urban, semi-urban, towns in Luzon area of Philippines. Microcredit seeks to promote business growth and improve well-being by expanding access to credit. We use a field experiment and follow-up survey to measure impacts of a credit expansion for Micro Entrepreneurs in Manila. The effects are diffuse, heterogeneous, and surprising. Although there is some evidence that profits increase, the mechanism seems to be that businesses shrink by shedding unproductive workers. Overall, borrowing households substitute away from labor (in both family and outside businesses), and into education. We also find substitution away from formal insurance, along with increases in access to informal risk sharing mechanisms. Our treatment effects are stronger for groups that are not typically targeted by micro lenders: male and higherincome entrepreneurs. In all, our results suggest that microcredit works broadly through risk management and investment at the household level, rather than directly through the targeted businesses. A number of prevailing factors that thwart the development of micro entrepreneurship in Philippines. Among all the factors, non-institutions encompassing various political, economic, social, cultural, technological, environmental and personal factors are affecting the scopes of operating these economic activities to a significant extent. It builds on research on the origins of the Microfinance Industry in Philippines; and particularly on understanding how it impacts the development activities of micro entrepreneurship, challenges and problems micro entrepreneurs face in marketing their products, in accessing credit, and the strategies they adopt to overcome these problems. This research involved extensive review of literature survey on the topic and analysis of industry specific documents and newspaper files and in-depth interviews.
Finally, this research aims at reflecting on which policies, if any, could facilitate the development of micro entrepreneurship, increase their degree of formality and attempts to identify the key non institutional barriers that hinder the development and encouragement of micro entrepreneurship in Philippines, and suggests a composite policy measure to overcome such encumbrances.