Dominador Ercilla has been a farmer almost all his life.
Being born into a family of farmers in San Jose, Nueva Ecija, he took the same road when he was forced to quit school after his second year in college due to poverty. He was hoping to get a degree in Agriculture at the then-Central Luzon Agricultural College (now Central Luzon State University).
For almost 50 years now, Ercilla has provided for his family with what he earns from rice farming in his 5-hectare land in Barangay A. Pascual in his hometown. By working on his plow from sunrise to sundown, he was able to send two of his three children through college who are now a nurse and a radiologic technologist.
However, it has not always been easy for Ercilla. Just like other farmers, he had to go to private money lenders to augment his production budget every crop cycle.
“Noong mga unang panahon, eh, sa Masagana 99 kami nangungutang. Hanggang sa bumalik kami sa private na nagpapautang na mas mataas ang interes. Umaabot sa 25 percent ang interes sa loob ng lima hanggang anim na buwan,” he said.
The interest rates imposed by private money lenders were high, but Ercilla had to take it with his eyes closed because it was the only way he could finance his rice production. This changed when he was invited by their association president to a seminar at the Philippine Rice Research Institute—where he learned about Sikat Saka.
Sikat Saka Program
Launched in 2012, Sikat Saka is a credit program implemented by the Land Bank of the Philippines (LandBank) with the Department of Agriculture (DA), which provides direct access to credit for small palay farmers who are members of irrigators associations.
The program is designed for palay farmers in the country, most of whom don’t have access to formal credit facilities and, thus, depend on informal lenders who charge exorbitant interest rates. The program is implemented in 45 major rice-producing provinces in the country like Nueva Ecija.
“Maganda ang benepisyo ng programa dahil napanatili kong mataas ang ani ko kaya napainut-inot kong napaayos ang aking bahay, napatapos ko ang adopted son ko sa pag-aaral at nakabili ng motor at hand tractor,” Ercilla shared.
In 2016, with additional funding for the program, LandBank expanded Sikat Saka to also cover small corn farmers in 11 major corn-producing provinces in the country.
As of the first quarter of 2017, P4.7 billion in loans were released under the Sikat Saka Program, benefiting a total of 13,465 farmer-borrowers in covered areas nationwide.
“Napakaganda nya para sa akin. Una, dahil sa mababang interes at makukuha nang minsanan ang pera sa bangko para mabili mo na kaagad ang kailangan sa bukid. At may kasama nang libreng insurance na hindi mo na iiintindi ang premium,” Ercilla said, who has been a Sikat Saka availer since 2012.
Sikat Saka has an interest rate of 15 percent annually for the first two crop cycles. This is further reduced by 1 percent for every succeeding cycle on loans fully paid on time, up to the eighth cycle.
The program also offers integrated support, such as irrigation, training, market, extension and administrative services. The farmers are, likewise, trained on credit discipline and financial management to teach them how to save, pay loans on time and better manage their finances.
“Ipinaabot namin ang pasasalamat sa pagtitiwala nila sa aming mga magsasaka na pahiramin ng puhunan,” said the now 71-year-old farmer who just availed himself of another loan under the program for the start of the new crop cycle.
Agri-fisheries financing program
Meanwhile, for non-palay and corn farmers who are not covered by Sikat Saka, LandBank has another program especially designed for non-agrarian-reform beneficiary (ARB) small farmers and fishermen in select provinces in the country.
Implemented in partnership with the DA and the Agricultural Credit Policy Council, the Agriculture and Fisheries Financing Program (AFFP) is a flexible credit facility that provides agricultural loans to marginalized small farmers and fishers who are registered in the Registry System for Basic Sectors in Agriculture (RSBSA).
Total loan releases under AFFP in the first quarter of this year amounted to P363 million, which benefited 2,340 small farmers and fishers across the country.
The program is designed to further increase the productive capacity of small farmers and fishers in the priority provinces, raise their income and contribute to the attainment of food self-sufficiency.
Among the priority provinces for AFFP implementation are Abra, Apayao, Benguet, Batanes, Cagayan, Kalinga, Ifugao, Nueva Vizcaya, Masbate, Romblon, Ilocos Norte, Isabela, Aurora, Zambales, Mountain Province and Palawan.
LandBank, likewise, has a lending program for ARBs through its organization called the Agrarian Production Credit Program (APCP). Implemented with the DA, Department of Agrarian Reform and Department of Environment and Natural Resources, APCP provides credit assistance to ARBs through their respective organizations and support for their on-farm and off-farm activities, whether individual or communal projects. APCP helps prepare ARBOs to become credit conduits of the bank under the regular lending window.
As of March 2017, LandBank has so far released P4 billion in loans benefiting 43,583 farmers nationwide. Eligible projects under APCP include agricultural production (crop, livestock, poultry and fishery), agri-enterprises and agri-related livelihood projects.
These retail lending programs are only among the wide array of services offered by LandBank in keeping with its thrust to promote inclusive growth and sustainable development, especially in the countryside.