“I would like to see simpler listing rules and procedures to encourage more SMEs to list. This will be done in the first half of 2012,� Jose T. Pardo, PSE chairman, told BusinessWorld in a text message on Monday.

The bourse will partner with industry groups such as the Philippine Chamber of Commerce and Industry (PCCI), Filipino-Chinese Chambers of Commerce and Industry (FFCCI), and the Philippine Exporters Confederation, Inc. (PhilExport) in order to encourage their respective member companies to list on the SME board, Mr. Pardo said.

This comes as small firms remain wary about the requirements for listing.

“There has to be a lot of convincing and information dissemination to be able to make [SMEs] list,� said PCCI Chairman Sergio R. Ortiz-Luis, Jr. in a telephone interview on Tuesday.

“This is difficult for some SMEs because it entails expenses and changing some of their practices in their companies,� Mr. Ortiz-Luis said.

SMEs, which are mostly family-owned units, will have to get accustomed first with PSE policies such as those on reportorial requirements, Mr. Ortiz-Luis, who is also PhilExport president, added.

“Reportorial requirements are something listed companies deal with and these SMEs do not have available professionals to be able to guide them. They do not have enough knowledge,� he admitted.

SMEs are defined as businesses with assets worth more than P3 million but less than P100 million or employing 10 to 199 employees.

The PSE’s SME board was launched in 2001 to provide SMEs another avenue to secure funds for working capital requirements and expansion programs apart from securing loans.

Companies looking to list on the SME board are required to have a one-year operating history, an authorized capital of P20 million to P100 million, net tangible assets of P5 million, and positive net operating income.

SMEs are then subjected to an evaluation of management integrity and capability, growth and profitability prospects, and business viability, among others.

Listing activity has so far been weak. To date, only two firms have listed on the PSE SME board: information technology firm iRipple, Inc., and lending company Makati Finance Corp.

Analyst Joseph Y. Roxas, president of brokerage Eagle Securities, Inc. said SMEs, in the meantime, can always look to private placements for fund raising amid low borrowing costs.

But Mr. Pardo insisted on more listings: “I am confident that with reforms… the capital market will grow as well,â€� he said.