PHILGUARANTEE extends P5.5 Billion in credit guarantees to 35 Partner Lending Institutions, Supports more than 31,000 Agri-based Workers
As part of its mandate to support agriculture and promote socioeconomic development in the sector, the Philippine Guarantee Corporation (PhilGuarantee) is able to grant P5.53 billion worth of guarantee lines to its 35 partner lending institutions (PLIs) for the first quarter of the year. The PLIs have so far made guarantee enrollments of P2.20 billion, serving 31,380 agriculture-based workers in the country.
Philguarantee continues to assure its support towards the agriculture sector as part of its mandate and key assistance role during the COVID-19 pandemic. As the administrator of the Agricultural Guarantee Fund Pool (AGFP), PhilGuarantee is able to encourage partner institutions to lend to small farmers and fisherfolks (SFFs) or their organizations, by providing guarantee coverage to their unsecured agricultural production loans. Eligible lending institutions include banks, cooperatives, farmers/people’s organizations other than cooperatives, non-government organizations, and corporations lending to SFFs.
During the height of the Enhanced Community Quarantine (ECQ) period, the Philguarantee Governing Board approved the reduction of the rate of guarantee fee from 1% to 0.5% and the increase of the guarantee coverage from 85% to 90% of the loan amount. The above measures were effective from April 15 to July 15, 2020 and applied to loans granted to palay farmers. Aside from reduced guarantee fees and the 90% risk-free coverage, the zero risk weighting provision has been afforded to PLIs beginning May 15, 2020, in accordance with BSP Circular 1084, Series 2020.
The above initiative of Philguantee to the agriculture sector is also in line with the institutional thrust of corporate social responsibility by financing for development, with the end in view of not only assisting affected sectors but also contribute to employment generation and livelihood opportunities.