Seaman-turned-farmer reduces reliance on informal lenders
UNHAPPY and longing for his family while working away at sea, Allan A. Ayco decided to disembark from the boat and his former life as a seafarer, returning to his home in Dumingag to make a living cultivating his farmland.
But like the other small farmers in town in need of capital, Ayco was forced to deal with informal lenders who charged high interest rates from 10 percent to up to 20 percent per month. He felt helpless against the unfair interest rates brought about by the monopoly of the post-production market by informal lenders.
Things started to look up for Ayco and other farmers in Dumingag when the Land Bank of the Philippines (Landbank) conducted site visits in the province and offered low-interest loans for production requirements under then newly-launched Landbank Sikat Saka Program.
“Malaking tulong talaga ang pagpasok ng Landbank sa buhay ko. Tuwangtuwa kami sa Sikat Saka Program. Hindi lang sa mababa ang interes, madali lang din ang proseso ng pagapply,” said Ayco.
Ayco was one of the first farmers in the area to avail of a loan under the Sikat Saka Program. Through the assistance of Landbank, Ayco enjoyed low interest of 0.75 percent to 1.25 percent per month under the Program from 2013 to 2019.
Since joining the formal credit system, Ayco said his income increased with every cropping cycle, allowing him to provide a better life for his family. He was able to save enough income to hire other farmers for planting services, as well as procure tractors and harvesting services that he rented out to other farmers in the area.
“Malaking tulong sa amin ang Sikat Saka Program. Kaya nga’t kusang loob akong nanghingkayat rin ng mga katulad kong magsasaka. Sinabi ko na maganda ito. Basta dapat aalagaan mo yung utang mo. Dapat maayos yung pagbayad mo para di siya mawala,” Ayco shared.
Aside from accessible financial support, Ayco and the other farmers in the area were also provided with support services and capacity building trainings by Landbank and its partner agencies.
However, the onset of the pandemic in 2020 closed the borders around the Zamboanga Peninsula and significantly affected their livelihood, which prevented them from renewing their credit line with Landbank for the next cropping season. Ayco shared that it was a difficult season.
So he was grateful when the health restrictions were finally eased and the Landbank Zamboanga del Sur Lending Center reached out to him and other farmers and to introduce the Agricultural Competitiveness Enhancement Fund (ACEF) Lending Program. As a long-time client of the Bank, Ayco was granted financing anew with low interest rates under the ACEF Lending Program to fund his rice production.
“Malaki talaga ang pasasalamat namin sa Landbank dahil sa naitulong nila sa aming mga magsasaka. Sana magpatuloy pa rin ang pagtulong ninyo sa amin,” Ayco said.
The ACEF is a direct lending program administered by Landbank in partnership with the Department of Agriculture (DA), which aims to increase the productivity and income of farmers and fishers, their cooperatives and associations, as well as micro and small enterprises (MSES).
The ACEF Lending Program finances farming needs such as the acquisition and establishment of production, post-harvest and processing machineries, equipment and facilities, farm inputs, and improvements.
As of October 31, Landbank has released under the ACEF lending program a total of P8.5 billion to support over 32,200 borrowers nationwide.