The Senate ratified the bicameral conference committee report on the bill repealing Republic Act No. 10000 or the Agri-Agra Reform Credit Act of 2009 to boost the access of agricultural communities to financial services and programs.
Sen. Cynthia Villar, chairperson of the Committee on Agriculture, hopes President Rodrigo Duterte will immediately sign the bill into law.
The senator sponsored the report harmonizing the disagreeing provisions of Senate Bill No. 2494 and House Bill No. 6134 or the Agriculture, Fisheries and Rural Development Financing Enhancement Act of 2022.
She said concerns were raised because banks would rather pay penalties than lend money to farmers, fisherfolks, and other agricultural stakeholders. She said more than increasing penalties to ensure bank compliance, she finds merit in the proposal to consolidate the loan allocation for farmers and fisherfolks and agrarian reform beneficiaries (ARB).
Mandated under the bill is an agriculture, fisheries, and rural development financing system through government and private banking institutions.
She said this will help improve productivity, income, competitiveness, and welfare of the rural community beneficiaries.
The financing system shall consist of loans and investments to finance activities that enhance productivity and increase the income of an agricultural and fisheries household.
She said all banking institutions, whether government or private, except newly-established banks for a period of five years from the date of start of the banks’ operations, shall set aside a credit quota, or a minimum mandatory agricultural and fisheries financing requirement of at least 25 percent of their total loanable funds.
A salient feature of the reconciled version of the bill is the creation of a special fund collected from penalties wherein 20 percent would be allocated for agricultural- and fishery-related organizational– capacity- and institution-building programs and activities.
This will be implemented by the Land Bank of the Philippines and the Development Bank of the Philippines with the help of training providers as well as the Agricultural Credit Policy Council and the Cooperative Development Authority.