Providing An Agrarian Reform Credit And Financing System For Agrarian Reform Beneficiaries Through Banking Institutions

Case Overview and Summary

Providing an Agrarian Reform Credit and Financing System for Agrarian Reform Beneficiaries Through Banking Institutions

- Evolution of an agrarian reform credit and financing system for beneficiaries (Section 1):
    - Beneficiaries include tillers, tenant-farmers, settlers, agricultural lessees, amortizing owners, owner-cultivators, farmers cooperatives, and compact farms.
    - Agrarian reform credit includes loans for acquisition of work animals, farm equipment, seeds, fertilizers, livestock, land acquisition, construction/acquisition of production facilities, and merchandising of agricultural commodities.

- Credit may be extended based on project feasibility, paying capacity, estimated production, and securities provided (Section 2).

- Banking institutions must set aside (Section 3):
    - At least 25% of loanable funds for agricultural credit.
    - At least 10% of loanable funds for agrarian reform credit to beneficiaries.
    - Percentages may be adjusted by the National Economic and Development Authority based on recommendations.

- Central Bank of the Philippines to promulgate rules and regulations (Section 4):
    - Banking institutions may invest in eligible government securities for unused agrarian reform credit funds, with provisions for monetization or repurchase (Section 4a).
    - Banking institutions may rediscount eligible agrarian reform credit paper with the Central Bank (Section 4b).

- Inconsistent laws, decrees, rules, and regulations are repealed or modified (Section 5).

- Decree takes effect immediately (Section 6).