Two accessible and affordable financial assistance was presented to potato farmers at the 1st Potato Summit on April 18, 2018, at the Gestdan Centrum, Baguio City. These services was made possible by the Agricultural Credit Policy Council (ACPC) and the Philippine Crop Insurance Policy Council (PCIC) through the Department of Agriculture (DA).
Carlo Abanquez, Information Officer of the ACPC discussed the two programs that are available for small farmers and fisherfolks.
First is the Production Loan Easy Access (PLEA), the brainchild of Sec. Manny Piñol. Knowing the importance of credit, previous programs of the ACPC were consolidated to make one program which is PLEA.
Main features of this program is that (1) it’s easy and convenient so good for those located in far-flung areas because usually, lending centers are usually in mainland; (2) it has a low interest rate of .5% per month compared to the usual 5-10% of mainstream lending companies; (3) it has expanded credit delivery channels through partner lending conduits in the form of associations or organizations who are closer to farmers and fisherfolks; (4) it instills credit discipline by conducting seminars to make borrowers understand the importance of repaying loans; and (5) it’s focused on small and marginalized farmers.
Small farmers, as defined by the Philippine Statistics Authority (PSA), are the ones with not more than three hectares of farm land. While the marginalized are those who have incomes within the poverty threshold according to the National Economic Development Authority (NEDA).
From two up to 10 years is given as term of loan for PLEA, depending on the gestation period. Farmers have the option of paying per harvest and payment plans can be customized. There is also no required collateral and all loans are insured under the PCIC for free. However, only member of the household can avail of the loan at a time.
The initial coverage of 15 provinces composed of top 10 poorest provinces in the Philippines with an addition of 5 selected provinces in 2017 has now expanded to 58 provinces. Included areas in the Cordillera are Apayao, Benguet, Mountain Province, and Kalinga.
The total amount disbursed last year was Php 468M with 150,000 borrowers and as of the first quarter this year, an additional 18 was approved.
Then the second program presented by ACPC, which was conceptualized together with the High Value Crops Program, is the Survival and Recovery Assistance Program (SURE). Since the Philippines is located in the Pacific Ring of Fire, the country is prone to typhoons and other natural disasters. Therefore this was made as a quick response post-disaster support facility that can provide emergency and recovery loan for small farmers and fisherfolks through lending conduits like in PLEA.
Area coverage should have a declaration of being under the state of calamity by the National Disaster Risk Reduction Management Council (NDRRMC), its local counterpart or the local government unit (LGU). Upon evaluation, DA’s regional field unit needs to declare in a report that area has suffered considerable damage to agriculture. Initial funding is P100M.
SURE features two kinds of assistance. (1) Surival offers Php 5,000 for the immediate needs of victims such as food, medicine, and clothing as gratis and (2) Recovery of Php 20,000 for livelihood activity/farm rehab which can be loaned with 0% interest and payable up to three years.
A loan moratorium for payment on outstanding loans is available for a one year period. Conduits may charge a service fee of up to 3%.
The PCIC, an attached agency of the DA, has seven insurance programs namely rice, corn, high value crops, non-crop agricultural asset, livestock, credit and life term, and fisheries.
Farmers of 15 years up to 79 years of age can insure their crops. For a Php 15,000 insurance, the fixed premium is Php 112.50 per year. While for a Php 50,000 insurance, the premium is Php 375. It can be renewed up to when the farmer reaches 79 years old.
In case of death, natural or accident, Php 15,000 plus a Php 5,000 burial benefit will be given to the beneficiaries.
Same as for potatoes, natural calamities, and pest and diseases are covered. Strating period of the insurance is from the emergence of the first new leaf up to harvesting.
The national government has given a Php 2.5B budget for free insurance. This year, it was increased to Php 3.5B. The challenge now is how to disburse all so we are encouraging everyone to apply and avail the free insurance said Jaime Gomez of PCIC. There is required minimum of 100 sq.m and a maximum of 3 ha. per cropping.
By Ayra Galanza
