Private corporations or businesses may also avail of agri-agra loans from banks

Aside from farmers and fisherfolks, banks may also lend to private corporations or businesses for purposes or activities mentioned under Section 23 of the "Agriculture and Fisheries Modernization Act of 1997" or AFMA.  This is emphasized in the Bangko Sentral ng Pilipinas’ (BSP) Circular No. 736-2011, the “Rules and Regulations on the Mandatory Credit Allocation for Agriculture and Agrarian Reform Credit.”

 

Specifically, the Circular says that "loans to a corporation can qualify as alternative compliance to the mandatory agricultural credit if the loan proceeds are used for any of the purposes or activities enumerated under Subsection X341.1 (f) of Circular No. 736, and that these activities generally benefit agrarian reform beneficiaries."

 

The list of qualified activities and purposes are listed as follows:

  1. agricultural production,

  2. promotion of agribusiness and exports,

  3. acquisition of work animals, farm and fishery equipment and machinery,

  4. acquisition of seeds, fertilizers, poultry, livestock, feeds and other similar items,

  5. acquisition of lands authorized under the Agrarian Reform Code of the Philippines and its amendments,

  6. construction, acquisition and repair of facilities for production, processing, storage, and marketing and such other facilities in support of agriculture and fisheries,

  7. efficient and effective merchandising of agricultural and fishery commodities stored and/or processed by the facilities aforecited in domestic and foreign commerce, and

  8. other activities identified in Section 23 of R.A. No. 8435, otherwise known as the "Agriculture and Fisheries Modernization Act of 1997", as follows:

  1. Agriculture and fisheries production including processing of fisheries and agri-based products and farm inputs,

  2. Acquisition of work animals, farm and fishery equipment and machinery,

  3. Acquisition of seeds, fertilizer, poultry, livestock, feeds and other similar items,

  4. Procurement of agriculture and fisheries products for storage, trading, processing and distribution,

  5. Acquisition of water pumps and installation of tube wells for irrigation,

  6. Construction, acquisition and repair of facilities for production, processing, storage, transportation, communication, marketing and such other facilities in support of agriculture and fisheries,

  7. Working capital for agriculture and fisheries graduates to enable them to engage in agriculture and fisheries-related economic activities,

  8. Agribusiness activities which support soil and water conservation and ecology-enhancing activities,

  9. Privately-funded and LGU-funded irrigation systems that are designed to protect the watershed,

  10. Working capital for long-gestating projects, and

  11. Credit guarantees on uncollateralized loans to farmers and fisherfolk.

 

A copy of BSP Circular No. 736-2011 is attached. --- PhilExport Advisory

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