A production loan amounting to P6.1 million availed of by Cordillera vegetable farmers was 100% paid.
Four farmer groups with the first matured loan were able to repay the said borrowed amount by late 2017. The initial payment is a part of a P43.6 Million Loan Fund downloaded to the 14 lending conduits for the vegetable farmers of Benguet under the Production Loan Easy Access (PLEA) program of the Agricultural Credit Policy Council (ACPC). The four successful farmers groups are the CATTUBO MPC in Atok; Lengawan Indigenous Farmers MPC (LIFCC) in Buguias; Pakiya MPC in Bokod; and Benguet Traders MPC which is a province-wide farmers group.
Kristle Ann S. Balingan, Focal Person of the ACPC Benguet Satellite Office said that the farmer borrowers paid their loans before its maturity dates. “These are the first group of lending conduits that were given 6 months to pay their loans and they paid it before that,” she said.
PLEA as a loaning system
PLEA is a special credit facility designed to address the financial needs of marginal and small farmers and fisher folk for a fast, convenient and affordable credit. Non-collateralized loans for agri-fishery production will be provided through cooperative banks, cooperatives and non-government organizations (NGOs) as credit delivery channels (lending conduits). PLEA imposes only six percent interest annually which goes to the conduit banks or farmers coop.
Those who are qualified to avail or eligible lending conduits are the type 1: cooperative banks, cooperatives and NGOs that are currently accredited under any existing partnership under the ACPC lending programs such as Land Bank of the Philippines and type 2: cooperatives, farmers and fisherfolk organizations, and NGOs that are not qualified as Type 1 conduits but must have been endorsed by the Benguet Agri-Pinoy Trading Center (BAPTC), Department of Agriculture (DA) – CAR and/or the Municipal Agriculture Office (MAO).
Qualified lending conduits are those endorsed by BAPTC, DA Regional Office, and the MAO. After the endorsement, ACPC personnel will validate, orient potential beneficiaries, and endorse for approval their loan applications. Upon release of the loans, ACPC will continue to monitor if the amounts loaned out are being used appropriately as agreed upon until the loan is fully paid.
Furthermore, vegetable production financed under the PLEA is covered by a crop insurance by the Philippine Crop Insurance Council (PCIC) that will help the farmers recover in cases of calamity. Destruction caused by pest and diseases are also covered by the insurance.
Eligible farmer borrowers can avail of up to Php50,000 depending on the vegetable production project to be financed with a maximum of 2,500 sq. m. of planting area. As to loan payment, it depends on the maturity date of the loan which is determined by the production cycle of the vegetables planned to be planted by the borrower.
In the event that the farmer-borrower is a consistent good payer he/she will be given the chance to avail of bigger loans.
BAPTC as a marketing arm
On the other hand, BAPTC is responsible for monitoring the trading and marketing of the produce of PLEA borrowers. This is to ensure that the farmer-borrowers are trading the estimated volume of their vegetable produce they committed in their loan application.
BAPTC in turn supports the monitoring system of the ACPC through the regular reports of farm produce traded in the center.
Success of rural credit
The one hundred percent repayment of the rural credit is just the start. Buguias farmer, Amado William of Lengawan Indigenous Farmers Multi-purpose Cooperative (LIFMPC), said that the regular visits done by APCC to monitor the status of the crops was of great help. He explained that this pushed them to really utilize the money for their production which made them earn enough money to pay their loans on-time.
The six percent interest of the loan that goes to the coop becomes a savings for the group which they can use for funding the loan requirements of their members. “Mayat ta nakaibati ti income ti coop ta mausar mi mitlang diyay kwarta,” William added. According to William, the no-collateral and low interest rate policy makes it easier for farmers to focus on production.
Once the loan of the first batch were paid for, the coop can renew their loan. As per endorsement of ACPC, the loan amount could be doubled, said Balingan. This is on the basis of the farmers coop’s credit history and performance.
This year, PLEA will be extending the program to the farmers of Mountain Province. The loan expansion gives more farmers in the Cordillera a chance to avail of more accessible credit programs.
Farmers’ cooperatives or farmers’ groups interested to avail of the PLEA may visit the ACPC Benguet Satellite office located at the 2nd Floor , Spot 2 Bldg., BAPTC, BSU Strawberry Fields, La Trinidad, Benguet and look for Kristle Ann S. Balingan or contact 09092069794.**Rebecca Dibdiben and Ayra Galanza
