There is still time to pass the amendments to the Agri-Agra Act – BSP

The central bank said there was still time to pass legislation amending the Agricultural Loans Act to broaden the projects eligible for financing, helping banks meet their legal obligations to lend to the agricultural sector.

“We recognize the limited time remaining for the 18and Congress. Among the bills supported by the BSP, we believe that the Agri-Agra Bill can be prioritized by Congress given that it is at an advanced stage in the legislative process,” said Governor of Bangko Sentral ng Pilipinas (BSP), Benjamin E. Diokno. virtual briefing Thursday.

The bill seeks to amend the Agri-Agra Reform Credit Act of 2009, also known as Republic Act No. 10000, which mandates lending quotas for banks in financing farmers and businesses. beneficiaries of agrarian reform.

“We are confident that the Senate and House (of Representatives) will reach a compromise for the Agri-Agra bills so that they can then ratify the bill when the session resumes on May 23,” said- he added.

Congress is currently on recess for the campaign session. The legislature will resume its work between May 23 and June 3.

The Agri-Agra bills in both chambers have passed the third and final reading and a bicameral conference is scheduled to harmonize the measures of the two chambers.

Senate Bill 2494, which passed third reading in February, allows more types of loans to count toward banks’ lending quotas for agriculture and land reform. The expanded list of projects eligible for financing includes loans to agribusinesses that contract qualified farmers, and agricultural value chain financing, covering the production, distribution, manufacturing and processing of agricultural products.

Its counterpart House Bill 6134 passed third and final reading in March 2020.

The 2009 Agri-Agra Credit Act requires banks to lend 15% of their loan portfolio to the agricultural sector, with a 10% quota set for land reform beneficiaries.

Compliance with quotas remains weak, with banks preferring to pay a fine rather than risk lending to the sector.

Agri-agra loans from banks totaled 804.17 billion pesos at the end of September. If they had respected the quotas, they would have issued at least 1,873 billion pesos in loans.

Separately, Diokno said the Senate is preparing legislation that will become the Financial Consumer Protection Act (FCPA), as well as the Philippine Deposit Insurance Corp. Charter Amendment Bill. (PDIC), for the signature of President Rodrigo. R. Duterte.

The FCPA will enable financial regulators to better handle consumer complaints and strengthen protections against cybersecurity and data breach issues.

Meanwhile, the PDIC bill will make the agency, which is currently a branch of the Ministry of Finance, an agency of BSP. This should improve policy and program coordination.

At the same briefing, Mr Diokno said the bank had reached an agreement for the design of the BSP complex, which is expected to rise in New Clark City, Tarlac.

The 21.32 hectare site will house the central bank’s new currency production facilities. Its components include a data and command center, offices, a museum, university buildings, a sports complex and commercial stands.

“The design will be finished in five or six months, and then we’ll outsource the construction, which will probably take about two years,” Diokno said. — Luz Wendy T. Noble