MANILA, Philippines — Government-owned Land Bank of the Philippines has released P12 billion in loans to farmers as part of the government’s efforts to boost the high value crops industry.
Landbank said some P11.93 billion in loans under the Sulong Saka Program or High-Value Crops Financing had been released as of end-July.
Launched December last year, the program was designed to promote wider crop diversification, particularly for high-value crops such as banana, cacao, cassava, coffee, oil palm, rubber, and vegetables, among others.
A significant portion or about P3.45 billion of the loans were released to support projects in the production of palm oil, followed by projects involving the production of banana and other fruits, with corresponding P1.88 billion and P1.35 billion loan releases, respectively.
A total of 992 borrowers from 72 provinces across the country have availed of the program, majority are small farmers and fishers and cooperatives.
“Crop diversity is essential to attain local food security, especially during this health crisis. We see that more and more farmers are being encouraged to engage in the production of high-value commodities, helping the country attain food security,” Landbank president and CEO Cecilia Borromeo said.
Aside from promoting crop production, the program also supports projects that involve the processing and marketing of high-value crops.
Eligible borrowers can apply for the establishment of nursery, budwood or mother and plant or parent clone gardens, new plantation, replanting, rejuvenation, and rehabilitation of old trees, post-harvest activities, and processing or manufacturing, as well as trading and export activities.
Under the program, small farm holders may apply for loans with an interest rate of five percent per annum. For other eligible borrowers, however, interest is based on prevailing market benchmark rate.
Production loans under the program are payable based on crop cycle or gestation and payback period of the project.
Meanwhile, tenor for fixed asset acquisition is based on project cash flow but not more than the economic useful life of fixed assets or remaining useful life for second hand or refurbished machines.