ACPC disburses P1.64-billion loans to farmers in 2 years

MANILA, Philippines — The Agricultural Credit Policy Council (ACPC) has disbursed P1.64 billion worth of loans since the launch of its Production Loan Easy Access (PLEA) program almost two years ago.

In a statement, ACPC said a total of 159 lending conduits extended loans to around 33,150 marginal and small farmers and fishers (MSFF).

ACPC said the PLEA program has reached about 10 percent or 45 of the 455 unbanked municipalities identified by the Bangko Sentral ng Pilipinas (BSP).

Unbanked municipalities refer to those with no presence of banks or similar financial institutions, therefore limiting the access to credit and other financial services of the people living in these areas.

“Through the PLEA, farmers and fishers in previously unbanked and unserved areas in CAR, Region 1, Region 4-A & 4-B, Region 6, Region 7, Region 9, Region 10, Region 12 and Region 13 now have access to affordable loans for their agri-fishery production,” ACPC said.

As of Dec. 31, 2018, the PLEA program registered a repayment rate of 91 percent. This is lower than the 97 percent repayment rate as of Sept. 30, 2018 due to the effects of natural calamities such as Typhoons Ompong and Usman on the production and harvests of the farmers and fishers during the last quarter of 2018.

ACPC said validation results from the field show that more than one half or 54 percent of PLEA beneficiaries are first-time borrowers to formal credit, and that 73 percent are new borrowers from ACPC-accredited lending conduits.

“This shows that through the ACPC’s partnerships with grassroots-based organizations, the PLEA continues to significantly contribute to financial inclusion as it enables the unserved and underserved MSFF to have easier access to financing,” ACPC said.

The PLEA is a credit facility designed to address the financial needs of MSFF by providing them with easy to access loans, which was launched in June 2017.

It is being implemented by ACPC through its lending conduits, which include grassroots-based organizations such as rural banks, cooperative banks, cooperatives, and non-government organizations (NGOs)/associations.

The loan program offers non-collateralized loans at six percent per annum or 0.5 percent per month with free crop insurance from the Philippine Crop Insurance Corp. (PCIC) and with flexible repayment schedule and convenient loan maturity.

Other loan programs of the ACPC include the Capital Loan Easy Access (CLEA) which aims to finance working capital requirements of trading, marketing, processing of agri-fisheries products; the Agriculture and Fisheries Machineries and Equipment (AFME) Loan which aims to finance acquisition of machinery, equipment and/or facilities from production, harvesting to post harvest; and the Survival and Recovery (SURE) loan which finances requirements in rehabilitating farming, fishing, livelihood activities of MSFF affected by calamity.

ACPC said the loan facilities complement the programs of the Land Bank of the Philippines (LBP) which focuses on providing credit assistance to MSFF.

“To ensure that MSFF can avail of the various credit programs, Secretary Piñol has instructed the ACPC to establish Loan Facilitation Teams (LoFTs) at the regional and provincial levels,” it added.

The LoFTs, composed of representatives from various DA attached agencies and LGUs, will answer queries and provide information on credit policies and programs. The LoFTs will also guide MSFF in complying with loan documentary requirements including the crafting of project proposals, business plans, farm plan and budget.

Moreover, ACPC it is seeking to engage government financial institutions (GFIs), namely the LBP, Development Bank of the Philippines (DBP) and the United Coconut Planters bank (UCPB) as credit program and fund administrators for its credit programs for 2019.

The ACPC is an attached agency of the Department of Agriculture tasked to develop and advocate agri-credit policies and orchestrate programs that would promote MSFF’s access to sustained financial services.