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State-guaranteed loans in farm sector hit ₧3.5B

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STATE-guaranteed loans in the agriculture sector reached P3.5 billion in the first half of the year, nearing the P3.7-billion target of Philippine Guarantee Corp. (PhilGuarantee) for the entire year.

PhilGuarantee President and CEO Alberto E. Pascual said loans guaranteed through the firm’s partner lending institutions have benefitted 35,360 small farmers and fishers.

Crops subsector accounted for the bulk of the guaranteed loans to agriculture sector, with P3.35 billion or 96 percent covered over the January to June 2021 period, Pascual said in a report to the Department of Finance (DOF).

Pascual said that for the second quarter of the year, guaranteed loans to the agriculture sector by 47 partner lending institutions (PLIs) have already reached P3.499 billion, which is already 95-percent of the 2021 target of P3.675 billion, benefitting 35,360 small farmers and fishers. He added that the outstanding balance as of June 30 amounted to P1.247 billion.

The livestock subsector came in second, with borrowings as of June this year amounting to P112.63 million, followed by fisheries with P27.86 million and poultry with P12.03 million.

“Since the beginning of the Covid-19 crisis in March 2020, PhilGuarantee lost no time to enable its mandate and respond to the clarion call of the government to provide assistance to affected agri-based workers by way of its guarantee program,” Pascual said.

As the administrator of the Agricultural Guarantee Fund Pool (AGFP), PhilGuarantee encourages its PLIs to lend to small farmers and fishers or their organizations, by providing guarantee coverage to their unsecured agricultural production loans.

Last year, PhilGuarantee’s approved guarantee lines to 41 PLIs extending loans to the agriculture sector amounted to P5.14 billion, with guaranteed loans totaling P4.25 billion.

“This amount is 21.4 percent beyond our goal of P3.5 billion and resulted into assisting 48,038 small farmers and fisherfolk nationwide. Outstanding balance as of 31 December 2020 amounted to P401.5 million,” Pascual said.

During the enhanced community quarantine period last year, Pascual said the PhilGuarantee Governing Board approved the reduction of the rate of guarantee fee from 1 percent to 0.5 percent and the increase of the guarantee coverage from 85 percent to 90 percent of the loan amount for palay-farmers’ borrowing through the AGFP. These measures were effective from April 15 to July 15, 2020.

Read full article on BusinessMirror

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