Lending establishments have expressed opposition to the passage of a measure that can condone the unpaid interests, penalties and surcharges on loans secured by farmers and fisher of us from the federal government, Senator Cynthia Villar mentioned Tuesday (June 6).

“On the part of the lenders, ayaw nila ng condonation kasi it’s sending a bad signal na itong mga hindi nagbayad, mabibigyan ng prebilihiyo, iyong mga nagbayad ang mape-penalize,” she mentioned.

“(So) we are not talking about condonation. We want to (but) even the farmers, they want a long-term solution to the problem of their inability to access cheap credit. That is a band-aid solution, iyang condonation,” Villar mentioned after listening to reviewing RA 10000, the Agri Agra Reform Act of 2009 or the legislation that offered farmers and fisher of us entry to low-cost credit score.

The mentioned legislation gives for the conduct of a assessment three years after its implementation, with the Bangko Sentral ng Pilipinas (BSP), Department of Agriculture (DA) and the Department of Agrarian Reform (DAR) required to submit their respective stories on the effectiveness of the measure to Congress yearly.

The legislation retains the 25% requirement of the loanable funds of banks to be devoted for agriculture and fisheries and of which 10% shall be for agrarian reform beneficiaries (ARBs).

It additionally gives for loans to help actions and functions specified underneath the Agriculture and Fisheries Modernization Act (AFMA) and the Agrarian Reform Code of the Philippines.

“Iyang mga condonation ay parang band assist iyan. We ought to discover out what’s unsuitable why the farmers are unable to get credit score from the banks na mas mura ang mortgage doon kaysa sa magpa-5-6 sila. Bakit hindi sila nakaka-avail? There have to be one thing unsuitable within the system. We need to discover out. Because one of many limitations why farmers should not aggressive they usually can’t attain excessive earnings is due to their lack of ability to entry low-cost credit score. That’s what we wish to resolve, that barrier.

“With this hearing, we are getting their opinion and we will study so we will pass a relevant legislation to support iyong Agri-Agra Law or amend again the Agri-Agra Law to make it more effective,” the senator mentioned.

Instead of condoning loans and penalties, Villar mentioned they’re contemplating of introducing the concept of offering for crop insurance coverage.

“We insure the crops, and the facilities of farmers para iyong mga bangko hindi sila matakot magpautang kasi kapag may nangyari doon sa crops, babayaran sila ng insurance company. Iyon ang ikinakatakot ng bangko, high risk eh. So kapag may crop insurance, ngayon pa lang ang nai-insure na crops is 15% of the total. So how can you hope na pauutangin ang farmers when ang subsidy lang natin is about 15% of the total loans or the total farmers. We were thinking, saan ba magandang dalhin ang pera ng gobyerno? Doon ba sa iba-ibang project or subsidy na lang sa insurance?” Villar mentioned.

The legislation’s intention was to present a financing system to enhance the productiveness of the agriculture and fisheries sectors, but, years after its enactment, its goal is but to be achieved.

Source: politics.com.ph