LandBank Expands Agri-Agra Loans To P237 Billion In 2021 – That’s My Bank!

Why have PH banks been unable to comply with the Agri-Agra Reform Credit Act of 2009 to allocate 15% of loans to agri farmers (under Department of Agriculture) and 10% to agra farmers (under Department of Agrarian Reform)? I say this shows patent lack of interest on both sides – banks advertising availability of loans, farmers thinking of borrowing.
(financial inclusion image[1] from Coins.ph; farm image from me, taken 17 December 2016)

Joann Villanuevasays (19 October 2021, “Agri Sector Seen To Remain Resilient With More Financing Boost,” PNA.gov.ph), “Monetary authorities said banks’ compliance on the law remains below the required (levels).” As of end-June 2021, the banks’ total agri lending has complied with a miserable 9.67% (out of a min 15%), and agra lending 0.96% (min 10%).

This negative double-sided agri-agra loan truth tells me that PH banks have failed to assist PH Agriculture in their own turfs! Either the law does not have enough teeth, or banks don’t care!

Additionally, Ms Joann quotes Chief Economist of Rizal Commercial Banking Corporation (RCBC) Michael Ricafort as saying that “the agriculture sector accounts for almost 10% of domestic output and around 25% of total employment.” I writer therefore conclude that PH banks are essentially ignoring the economic importance of the agriculture sector, but not the RCBC (inset, Michael Ricafort).

Notwithstanding, there is very good loan news from LandBank! ANN says as of December 2020, LandBank’s agri loans accounted for 76.95%, agra loans 11.52% (Author Not Named, 16 May 2021, “Landbank Supports Agri-Agra Law Amendments To Expand Loan Access For Farmers, Fishers[2],” LandBank.com). That’s actual 77% vs required 15% and 12% vs 10% required. Thus, LandBank’s loans grew from P222 Billion in 2018 to P236 Billion in 2019 to P237 Billion in 2020.

For agriculture, LandBank is doing big things and right that the other PH banks know or care little about!

ANN also says LandBank “fully supports the ongoing Senate initiative to amend the (Agri-Agra Law), which will provide farmers and fishers nationwide an expanded and easier access to responsive agricultural financing.”

How? Like documentary requirements, what has LandBank done to encourage non-literate farmer-borrowers? ANN says in 2019, LandBank “started simplifying its loan processes to make the Bank’s programs more accessible to small farmers and fishers.” The details: (1) From 3 documents, the loan application form is now only 1 page. (2) From 14 pages, promissory note is now only 1 page. You scare non-literate requiring them voluminous documents to submit for any loan!

ANN also says that in partnership with the Department of Agriculture (DA) and Department of Agrarian Reform (DAR), LandBank has assisted a total of 2,696,839 farmers and fishers nationwide as of end-March 2021, an increase of 25,990 for January-March.

“Of the P229.70 Billion total outstanding loans, P36.27 Billion benefitted small farmers and fishers, cooperatives and farmers’ associations, rural financial institutions and other conduits.” The DA and DAR should thank LandBank!

LandBank knows The Big Thing that it should be doing for The Small Farmers, and is doing it for them.@517


[1]https://coins.ph/blog/filipino-women-win-when-it-comes-to-financial/

[2]https://www.landbank.com/news/landbank-supports-agri-agra-law-amendments-to-expand-loan-access-for-farmers-fishers

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