Agriculture loan guarantees reach P3.5 billion in H1

MANILA, Philippines — The government extended P3.5 billion in guarantees to loans in the agriculture sector in the first semester, nearly achieving the full year target of P3.7 billion.

The Philippine Guarantee Corp. (PhilGuarantee) yesterday reported the amount covered loans shouldered by 47 partner-lending institutions (PLIs) and 35,360 farmers and fishermen.

“For the second quarter, guaranteed loans to the agriculture sector by 47 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 fisherfolk. The outstanding balance as of June 30, 2021, amounted to P1.247 billion,” PhilGuarantee president and CEO Alberto Pascual  said.

In administrating the Agricultural Guarantee Fund Pool (AGFP), the PhilGuarantee encourages PLIs to lend farmers and fishermen, or their organizations, by providing guarantee coverages to unsecured agricultural production loans.

Crop planters were the biggest beneficiaries with  roughly 96 percent or P3.35 billion in guarantees. Livestock growers came in second with borrowings amounting to P112.63 million, followed by fisherfolk with P27.86 million and poultry raisers 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.

Last year, PhilGuarantee’s 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. The outstanding balance as of Dec. 31, 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 to 0.5 percent, from one percent.

Likewise, PhilGuarantee increased the guarantee coverage 90 percent, from 85 percent, of the loan amount for rice farmers borrowing through the AGFP.