MANILA, Philippines - The Department of Agriculture (DA) recently signed a memorandum of agreement (MOA) with state-run Land Bank of the Philippines (Landbank) to formally set up the Sikat Saka Program for lending to small palay farmers under the Department’s Food Staples Sufficiency Program (FSSP).
The program will make a credit window available to small farmers giving them direct access to credit through their respective irrigator’s associations (IAs). The funds would be used for palay production during the dry season.
Under this scheme, farmers will enjoy a lower interest rate of 15 percent per annum for the first two cycles. Then, for succeeding cycles, the rate will go down by one percent per cycle. Reduced interest rates shall also be given for those who will fully pay their production loan on time.
At the same time, the program also introduces the DA’s use of automated teller machines (ATMs) in releasing program loans to farmers.
“The introduction of the use of modern banking technology will bring about an empowering impact to the farmers in the countryside,” Agriculture Secretary Proceso J. Alcala said.
For her part, Landbank president Gilda Pico said that they are looking forward to making the Sikat Saka Program one of the strategies in reaching the 55 municipalities that still remained unserved by Landbank. She said that Landbank is happy to again work together with the DA in implementing this latest financing program for rice farmers.
Other DA attached agencies shall extend technical support to farmer-beneficiaries under the program. These support services include extension and training from the Agricultural Training Institute (ATI); processing and market linkage from the National Agribusiness Corporation (NABCOR) and the National Food Authority (NFA); and organizational support to potential IAs from the National Irrigation Administration (NIA).
The Agricultural Credit Policy Council (ACPC), which provided the initial P200 million fund from the DA, shall conduct program evaluation of the Sikat Saka Program.
ACPC executive director Jovita M. Corpuz is hopeful that the guidelines of the program will be completed soon so that loans to farmer-beneficiaries will be released in time for the planting season.
The credit program will be pilot-tested in the four major rice producing provinces of Isabela, Nueva Ecija, Iloilo and North Cotabato