THE chairman of the House Committee on Economic Affairs urged the leadership of Congress to pass the proposed Rural and Community Banking Act of 2019.
AAMBIS-OWA Party-list Rep. Sharon S. Garin said in a statement issued on Monday her House Bill 4256 is set to bring rural banking closer and more accessible to farmers, fishermen and agricultural workers.
The bill is pending with the Committee on Banks and Financial Intermediaries since September 4. The measure aims to promote the establishment of rural banking systems in remote and far-flung areas of the country by amending Republic Act 10574, also known as the Rural Act of 1992.
The bill, if enacted into law, mandates the Land Bank of the Philippines, Development Bank of the Philippines and other government-owned and controlled banks and financial institution to subscribe to the capital stock of rural banks that require the need for funds. The bill also allows investors from the Association of Southeast Asian Nations countries to own at least 60 percent of the capital stock of any rural bank, provided that at least 60 percent of the members its board of directors are Filipino citizens at the time of their assumption to office.
Also, Garin underscored the importance of rural banking in boosting agricultural activities and stirring economic activities in rural areas.
“Rural banks cater to the need of small farmers and [fishermen]. The agriculture sector is said to be the second-largest generator of employment in the country. Workers from agriculture sectors are also among the poorest citizen,” she said. “Investment in this sector is, therefore, crucial to help alleviate poverty in the country.”
Garin said she considers the bill as an effort to increase foreign investments, boost competition and strengthen economic ties with the country’s neighbors in Southeast Asia.
“The presence of sustainable rural banks capable of providing much-needed capital to boost agricultural activities can economically empower farmers,” the lawmaker added.