The Agricultural Credit Policy Council (ACPC) turned over a combined total of P1 billion in additional funds to the Land Bank of the Philippines (LBP) and the People’s Credit and Finance Corporation (PCFC) in a check turnover ceremony held on February 14, 2014 at the Sulo Riviera Hotel in Quezon City.
Of the P1 billion total amount, the LBP received P550 million, while PCFC got P450 Million. The funds that were released to the two Government Financing Institutions (GFIs) are for the implementation in 2014 of the Agriculture and Fisheries Financing Program (AFFP).
Under the General Appropriations Act of 2013, the P1 billion loan funds that were appropriated to ACPC was for “the establishment of a flexible credit facility for the benefit of small farmers registered in the Registry System of Basic Sectors in Agriculture (RSBSA) as an alternative to the rigid and stringent credit facilities usually provided by banks.”
Pursuant to this legislative provision, the establishment of the Agriculture and Fisheries Financing Program or AFFP was approved by the ACPC Governing Council on July 18, 2013. The program’s Implementing Guidelines, on the other hand, were approved by DA Secretary and ACPC Chair, Proceso J. Alcala, on December 9, 2013 after going through a rigorous review process.
In her message during the check turn over ceremony, Executive Director Jovita M. Corpuz cited that the implementation of the AFFP intends to enhance “financial inclusion” of the rural poor – particularly those who belong to the agriculture sector – as a means to bring about more inclusive growth. “Insufficient access to financing by small farm and fishing households is seen as one of the biggest constraints for advancing both rural and agricultural development,” Ms Corpuz pointed out. She added that “although the local banking sector is known to have more than sufficient funds for lending, access to these funds by smallholders in the agriculture sector remains constrained.”
The keynote speaker of the event was DA Undersecretary for Administration and Finance Antonio A. Fleta. In his message, Usec. Fleta remarked about the holistic framework of the AFFP. “The AFFP,” said Usec. Fleta, “not only provides credit for the whole agricultural supply chain and other livelihood activities, it is also supported with capacity building, technical assistance, credit guarantee, marketing, and monitoring and evaluation components in coordination with other concerned government agencies and institutions.”
Usec. Fleta also thanked the ACPC, LBP, PCFC, the DA Regional Field Offices, the provincial and municipal government units together with their Regional and Provincial Agri-Credit Desk Officers (ACDOs) for their “all-out cooperation and support for the program.”
A brief on the AFFP explaining the program’s features was presented during the event by ACPC Deputy Executive Director Ramon C. Yedra prior to the turnover of funds to LBP and PCFC. After receiving the funds for the AFFP on behalf of their respective GFIs, LBP President Gilda E. Pico and PCFC President Edgar V. Generoso delivered acknowledgment messages.
Also present to witness the fund turnover ceremony was Department of Budget and Management (DBM) Undersecretary Mario Relampagos. The RSBSA is a joint project of the DBM together with the National Statistics Office (NSO).
Implementation of the AFFP will be piloted in the country’s twenty (20) poorest provinces that already have a completed RSBSA. These are the provinces of Ifugao, Mountain Province, Abra, Kalinga, Apayao, Romblon, Camarines Sur, Masbate, North Cotabato, Northern Samar, Eastern Samar, Western Samar, Siquijor, Zamboanga del Norte, Davao Oriental, Sarangani, Agusan del Sur, Sultan Kudarat, Surigao del Norte, and Surigao del Sur.
The AFFP funds transferred by ACPC shall be administered by LBP and PCFC for a period of five years. The implementation of the AFFP will be evaluated after two years by the Philippine Institute for Development Studies (PIDS).