Agrarian, agri loan restructuring and condonation bill endorsed to House plenary

Published December 28, 2019, 6:43 PM

by Ellalyn De Vera & Richa Noriega

By Charissa Luci-Atienza

The House Committee on Agrarian Reform has endorsed for plenary approval of a bill granting the farmers, fisherfolk and agrarian reform beneficiaries the opportunity to regain access to government and commercial credit facilities through the condonation of unpaid interests, penalties and surcharges on their existing loans obtained through government lending programs.

House of the Representatives (ALVIN KASIBAN / MANILA BULLETIN / FILE PHOTO)
House of the Representatives (ALVIN KASIBAN / MANILA BULLETIN / FILE PHOTO)

The House panel, chaired by Ifugao Rep. Solomon Chungalao urged the House leadership to prioritize the plenary deliberations and passage of House Bill No.5083 or the proposed Agrarian and Agricultural Loan Restructuring and Condonation Act.

The Chungalao panel recommended the plenary approval of the bill,  before Congress adjourned for monthlong Christmas break on December 17.

The bill seeks to free the farmers, fisherfolk and agrarian reform beneficiaries from the “bondage of debt”, said COOP-NATTCO partylist Rep.  Sabiniano Canama, who principally authored HB 5083.

He said all unpaid interests,  penalties and surcharges of agricultural and agrarian reform credit secured by farmers, fisherfolk and agrarian reform beneficiaries from the Department of Agriculture (DA), Department of Agrarian Reform (DAR), People’s Credit and Finance Corporation (PCFC), Cooperative Development Authority (CDA), National Food Authority (NFA), and Quedan and Rural Credit Guarantee Corporation (QUEDANCOR) shall be condoned upon the approval of the application for condonation of a borrower qualified under the proposed Act.

Canama said his bill sets four conditions in which the proposed condonation shall be granted.

The bases for the condonation shall be  limited to force majeure, which the measure defines as “events whether natural or political, beyond the reasonable control of a loan borrower, which have a material adverse effect on the ability of the borrower to pay an obligation,” or to market aberration and shall, in no case, be applied for the wilful default of the borrower to pay such loans.

The three other conditions are the following: the accumulated payments of not less than five percent of the loan principal shall have been paid at the time of application for condonation;  to encourage borrowing discipline and enhance creditworthiness, a graduation process shall be followed in consonance with the plan of payment such that a borrower shall be granted a one-time condonation only; and the condonation of unpaid interests, penalties and surcharges from loans acquired through conduit banks and financial institutions and the concerned agencies shall be in conformity with the applicable general banking laws and regulations of the Bangko Sentral ng Pilipinas (BSP).

Covered by the condonation program are Agricultural and Agrarian Reform credit secured through the Credit Assistance Program-Program Beneficiaries Development of the DAR; Agricultural and Agrarian Reform credit secured through the terminated credit program schemes of the DAR, such as the Dutch Rural Development Assistance Program (DRDAP), DAR Direct Lending Financing Program (DDLFP), DAR Special Projects Office (SPO) Direct, and the SPO Window III Financing Program for Agrarian Reform Beneficiaries of the DAR and the Development Bank of the Philippines (DBP).

The Resettlement Loan Assistance Program of the DAR for individual agrarian reform beneficiaries; agricultural credit secured through the High Yield Crop Loan Assistance Program of the DA; agricultural credit secured through Microfinance Program for Small Farmers and Fisherfolk and the Household of the PCFC; Cooperative Development Loan Fund of the CDA shall also be covered by the condonation program.

The Farmers Level Grain Center of the NFA; Comprehensive Agrarian Reform Program-Barangay Marketing Center (CARP-BMC); and  all agri-credit guarantee programs of QUEDANCOR are also expected to be included in the program.

HB 5083 provides that the payment period for the restructured loan shall depend on the borrower’s financial capacity

The approval of the application for condonation shall serve as the basis for the concerned agency or corporation to write off the unpaid interests, penalties and surcharges condoned.

The annual collection from payments of loans shall be remitted to the Bureau of Treasury (BOTr) under the Agrarian Reform Fund.

Within 60 days from the effectivity of the proposed Act, the DAR Secretary, in consultation with the DA Secretary and heads of CDA,  PCFC,  ACPC,  and BSP, shall promulgate the implementing rules and regulations of the proposed Agrarian and Agricultural Loan Restructuring and Condonation Act.

 
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Agrarian, agri loan restructuring and condonation bill endorsed to House plenary

Published December 28, 2019, 12:00 AM

by manilabulletin_admin

By Charissa Luci-Atienza

The House Committee on Agrarian Reform has endorsed for plenary approval of a bill granting the farmers, fisherfolk and agrarian reform beneficiaries the opportunity to regain access to government and commercial credit facilities through the condonation of unpaid interests, penalties and surcharges on their existing loans obtained through government lending programs.

House of the Representatives (ALVIN KASIBAN / MANILA BULLETIN / FILE PHOTO)
House of the Representatives (ALVIN KASIBAN / MANILA BULLETIN / FILE PHOTO)

The House panel, chaired by Ifugao Rep. Solomon Chungalao urged the House leadership to prioritize the plenary deliberations and passage of House Bill No.5083 or the proposed Agrarian and Agricultural Loan Restructuring and Condonation Act.

The Chungalao panel recommended the plenary approval of the bill,  before Congress adjourned for monthlong Christmas break on December 17.

The bill seeks to free the farmers, fisherfolk and agrarian reform beneficiaries from the “bondage of debt”, said COOP-NATTCO partylist Rep.  Sabiniano Canama, who principally authored HB 5083.

He said all unpaid interests,  penalties and surcharges of agricultural and agrarian reform credit secured by farmers, fisherfolk and agrarian reform beneficiaries from the Department of Agriculture (DA), Department of Agrarian Reform (DAR), People’s Credit and Finance Corporation (PCFC), Cooperative Development Authority (CDA), National Food Authority (NFA), and Quedan and Rural Credit Guarantee Corporation (QUEDANCOR) shall be condoned upon the approval of the application for condonation of a borrower qualified under the proposed Act.

Canama said his bill sets four conditions in which the proposed condonation shall be granted.

The bases for the condonation shall be  limited to force majeure, which the measure defines as “events whether natural or political, beyond the reasonable control of a loan borrower, which have a material adverse effect on the ability of the borrower to pay an obligation,” or to market aberration and shall, in no case, be applied for the wilful default of the borrower to pay such loans.

The three other conditions are the following: the accumulated payments of not less than five percent of the loan principal shall have been paid at the time of application for condonation;  to encourage borrowing discipline and enhance creditworthiness, a graduation process shall be followed in consonance with the plan of payment such that a borrower shall be granted a one-time condonation only; and the condonation of unpaid interests, penalties and surcharges from loans acquired through conduit banks and financial institutions and the concerned agencies shall be in conformity with the applicable general banking laws and regulations of the Bangko Sentral ng Pilipinas (BSP).

Covered by the condonation program are Agricultural and Agrarian Reform credit secured through the Credit Assistance Program-Program Beneficiaries Development of the DAR; Agricultural and Agrarian Reform credit secured through the terminated credit program schemes of the DAR, such as the Dutch Rural Development Assistance Program (DRDAP), DAR Direct Lending Financing Program (DDLFP), DAR Special Projects Office (SPO) Direct, and the SPO Window III Financing Program for Agrarian Reform Beneficiaries of the DAR and the Development Bank of the Philippines (DBP).

The Resettlement Loan Assistance Program of the DAR for individual agrarian reform beneficiaries; agricultural credit secured through the High Yield Crop Loan Assistance Program of the DA; agricultural credit secured through Microfinance Program for Small Farmers and Fisherfolk and the Household of the PCFC; Cooperative Development Loan Fund of the CDA shall also be covered by the condonation program.

The Farmers Level Grain Center of the NFA; Comprehensive Agrarian Reform Program-Barangay Marketing Center (CARP-BMC); and  all agri-credit guarantee programs of QUEDANCOR are also expected to be included in the program.

HB 5083 provides that the payment period for the restructured loan shall depend on the borrower’s financial capacity

The approval of the application for condonation shall serve as the basis for the concerned agency or corporation to write off the unpaid interests, penalties and surcharges condoned.

The annual collection from payments of loans shall be remitted to the Bureau of Treasury (BOTr) under the Agrarian Reform Fund.

Within 60 days from the effectivity of the proposed Act, the DAR Secretary, in consultation with the DA Secretary and heads of CDA,  PCFC,  ACPC,  and BSP, shall promulgate the implementing rules and regulations of the proposed Agrarian and Agricultural Loan Restructuring and Condonation Act.

 
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