PH Banks To Increase Lending to Agriculture Sector

A survey conducted by the Bangko Sentral ng Pilipinas (BSP) and the Department of Agriculture (DA) revealed that philippine banks are increasing lending to the agriculture sector in the next 12 months to support the country’s strong economic growth.

This is due to the increasing demand for agricultural loans and to serve as compliance to the mandatory credit allocation.

Moreover, banks want to fulfill their mandate to extend agricultural loans to help farmers expand their businesses, improve their quality of life, provide for the farmers’ financing needs, and prevent them from availing of high-interest rate loans from informal lenders.

The banking sector also wants to support the country’s goal of attaining food security, financial stability, and economic development.

The survey focused on banks’ agricultural lending experience in 2021 compared to 2020. It considered practices and outcomes in the different aspects of branch banking operations such as agricultural loan releases and demand; interest rates and other charges on bank loans; borrowers’ repayment and debt position; bank risk management; bank profitability; problems encountered by banking units; effects of the COVID-19 pandemic on banking performance; and the plans and prospects by banks for the next year.

Source: Philstar