Philguarantee-backed loans for agriculture just under P3.5 billion

THE PHILIPPINE Guarantee Corp. (Philguarantee) approved guarantee cover on loans worth P3.499 billion to the agriculture sector in the first half, helping fund 35,360 farmers and fisherfolk borrowing from banks, the Department of Finance (DoF) said.

Citing a report from Philguarantee, the DoF said in a statement Thursday that the guarantees were given to 47 lending institutions, and account for 95% of the institution’s P3.675-billion target for its Agricultural Guarantee Fund Pool this year.

The facility aims to encourage bank lending to small farmers and fisherfolk to boost their production.

Farmers took out covered loans worth of P3.35 billion while the livestock sector accounted for P112.63.

Loans guaranteed in the fisheries sector amounted to P27.86 million, while those taken on by poultry farmers totaled P12.03 million.

“Philguarantee (is fulfilling) its mandate… to provide assistance to affected agri-based workers by way of its guarantee program,” Philguarantee President and CEO Alberto E. Pascual said in a statement.

Last year, Philguarantee provided cover on P4.25 billion worth of loans to 48,038 borrowers in the agriculture sector, after approving P5.14 billion in guarantees given to 41 lenders.

Philguarantee exceeded its P3.5-billion target last year by 21.4%.

It also granted three months of relief last year by reducing the guarantee fee to 0.5% from 1% previously, and raised the amount it can guarantee to 90% of loan value for rice farmers, up from 85%.

For lending to small businesses, Philguarantee approved P37.7 billion worth of guarantee facilities to 34 banks starting in December.

Some P2.1 billion worth of loans were guaranteed for 10,000 micro-, small-, and medium-sized enterprises (MSMEs) borrowers.

The credit guarantee program for MSMEs is intended to assist hard-hit businesses seeking to survive the pandemic by encouraging banks to lend more to the sector. — Beatrice M. Laforga

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