Landbank to aggressively provide lending to small farmers
“With our new lending strategy, LANDBANK goes to the farmers, and not the farmers going to LANDBANK.”
This was according to Land Bank of the Philippines President Alex Buenaventura as the bank adopted a direct marketing strategy in lending to farmers, which is part of its aggressive thrust to channel financial assistance to the farming sector.
Under this strategy, a master list of small farmers will be generated by LANDBANK in consultation with local representatives of the Department of Agrarian Reform and the Department of Agriculture.
Trained Supervised Credit Technicians from the Bank’s Lending Centers will then market directly to all farmers in their assigned master list.
Another innovative lending scheme Landbank is pushing for is its “Farmers Corporatives Inclusive Financing Program”, which is open to Farmers Cooperatives who enter into a “Farm Management and Marketing Agreement (FMMA)” with a big Agri Corporative Corporation (ACC).
Under the program, LANDBANK will take charge of Land Consolidation and Coop Organizing for the small farmers.
For the big ACC, LANDBANK will provide a Fully Integrated Corporate Loan for Production, Postharvest and Processing Facilities with lower debt to equity ratio of 90:10 at competitive interest rate.
Meanwhile, the ACC’s roles under the program cover the following: to increase farm production to global standards; to buy from Farmers Cooperative 100 percent of production at agreed price per kilo as specified in the FMMA; and to hire farm workers from nominees of Farmers Cooperative members.
“The main objective of the Farmers Corporatives Inclusive Financing Program of LANDBANK is to raise the income of each farmer family way above the P10,000 Poverty Line Threshold per month through corporate farming by partner ACCs which will double production and harvest sales net income of small farmers,” said Buenaventura.