THE Land Bank of the Philippines (LandBank) said it has released nearly P12 billion worth of loans to the country’s high value crops sector as of end-July.
LandBank said P3.45 billion of the total loans were released in support of oil palm production projects while P1.88 billion were loans for banana production.
LandBank added that P1.35-billion worth of loans went to other fruits production.
The loans were released under the bank’s Sulong Saka Program or High-Value Crop Financing program.
“A total of 992 borrowers from 72 provinces across the country have availed of the program,” it said in a statement on Tuesday.
“Of these borrowers, 421 are Small Farmers and Fishers (SFFs), 302 are cooperatives, 183 are Micro, Small and Medium Enterprises (MSMEs), and the remaining 86 are Countryside Financial Institutions (CFIs), Large Agribusiness Enterprises (LAEs)/corporations, associations, Microfinance Institutions (MFIs), Local Government Units (LGUs), Government-Owned and Controlled Corporations (GOCC), and Financial Institutions (FIs),” it added.
LandBank said the Sulong Saka program was launched in December last year and was designed to promote wider crop diversification in the country’s agriculture sector.
The program seeks to support the production of banana, cacao, cassava, coffee, oil palm, rubber, and vegetables, among others, according to the bank.
“Crop diversity is essential to attain local food security, especially during this health crisis,” LandBank President and CEO Cecila C. Borromeo said.
“Through the LandBank Sulong Saka Program, we see that more and more farmers are being encouraged to engage in the production of high-value commodities, helping the country attain food security,” Borromeo added.
The high-value crop financing program does not only promote crop diversification but also supports projects that involve the processing and marketing of these commodities, LandBank said.
LandBank said eligible borrowers can apply for the establishment of nursery, budwood or mother and plant or parent clone gardens; new plantation, replanting, rejuvenation, and rehabilitation of old trees;
post-harvest activities, and processing or manufacturing; as well as trading and export activities.
Under the Sulong Saka program, small-scale farmers could apply for loans with a 5 percent interest rate per annum, LandBank said. However, for other eligible borrowers, the interest is based on the prevailing market benchmark rate.
“Production loans under the program are payable based on crop cycle or gestation and payback period of the project,” it said.
“Meanwhile, tenor for fixed asset acquisition is based on project cash flow but not more than the economic useful life of fixed assets or remaining useful life for second hand or refurbished machines. For permanent working capital and working capital, tenor of up to three (3) years and one (1) year, respectively, is provided,” it added.