The House of Representatives on Tuesday approved on third and final reading the proposed Agrarian and Agricultural Loan Restructuring and Condonation Act.
Lawmakers voted 231 affirmative, 0 negative and without abstention for the pasage of House Bill 5702, which mandates the one-time condonation of unpaid interests, penalties, and surcharges of agricultural and agrarian loans secured by farmers, fisherfolks and agrarian reform beneficiaries from the Department of Agrarian Reforms (DAR), Department of Agriculture (DA), People’s Credit and Finance Corp. (PCFC), Cooperative Development Authority, National Food Authority (NFA), at Quedan and Rural Credit Guarantee Corp. (Quedancor).
The bill will now be transmitted to the Senate for its own deliberations.
The bill seeks to facilitate the reintegration into the financial and banking system of farmers, fisherfolks, and agrarian reform beneficiaries who have unpaid loans and thus enabling them to avail of other credit facilities.
The measure also provides that the loan condonation shall cover only cases involving force majeure or market aberration, and cannot be applied to cases of willful default of a borrower.
It covers applicants who have paid at least five percent of the principal amount at the time of application for condonation.
The bill stipulates that the condonation program be in conformity with the general banking laws and regulations of the Bangko Sentral ng Pilipinas.
It mandates that collections from terminated credit programs be remitted to the Bureau of Treasury.
The bill provides that the status of loans restructured under the program be restored to good standing upon three consecutive payments by the borrower mandates government agencies to write off loans from the books of terminated lending programs.
The measure said within 60 days from the effectivity of this proposal, the secretary of the DAR shall, in consultation with the secretaries of heads of offices of DA, CDA, NFA, Quedancor, the Agriculture Credit Policy Council and the BSP promulgate rules and regulations for the effective implementation of this proposal.
Image credits: AP/Aaron Favila
