State-owned Land Bank of the Philippines has formalized its partnership with the Department of Agrarian Reform (DAR) for the implementation of the Accessible Funds for Delivery to Agrarian Reform Beneficiaries (AFFORD-ARBs) lending program.
Landbank initially allocated P5 billion for the program which may be availed by ARBs to finance the production of rice, corn and high-value crops as well as the acquisition of small farm implements.
Landbank said AFFORD-ARBs will focus on lending to individual beneficiaries identified through a list to be provided by DAR and the bank’s Agrarian Services Group. It is also expected to provide technical assistance to borrowers through orientations and financial literacy seminars.
“We are grateful to have a solid partnership with DAR, which allows us to pursue a more focused and direct approach in lending to individual small farmers. By being able to identify the ARBs that we need to target, we are able to focus our efforts and provide the appropriate financing and technical support,” Cecilia Borromeo, Landbank president and chief executive officer, said in a statement.
Landbank said its services are now more accessible to farmers and fishers as the loan process was simplified and the interest was lowered.
Specific enhancements include shorter loan application forms and less documentary requirements and a fixed interest rate of 5 percent per annum for AFFORD-ARBs, from the previous 6 percent for short term loans and 7 percent for long term loans.
As of August 2019, over P74 million in loans has already been released to more than 300 borrowers under the AFFORD-ARBs program, the bank said.
Landbank, the only bank present in all of the country’s 81 provinces, remains the single largest lender to small farmers and fishers. It is the leading provider of financial assistance to micro enterprises and government financial institutions.