BSP expands coverage of micro-agri loan

Small farmers may soon tap any bank for their funding needs after the Bangko Sentral ng Pilipinas (BSP) allowed all banks to offer micro-agri loans.
BSP Governor Amando M. Tetangco, Jr. told reporters on Friday the Monetary Board, the central bank’s policy-setting body, has agreed to permit all banks to offer micro-agri loans, instead of limiting this service to rural banks participating in the Microenterprise Access to Banking Services (MABS) program.
MABS, which receives funding from the United States Agency for International Development, is assisting the Rural Bankers Association of the Philippines (RBAP) expand member-banks’ financial products and services.
The central bank would issue a circular formalizing the new rule this week.
“In January 2006, the Monetary Board approved the RBAP-MABS micro-agri loan product and classified this as a microfinance loan. This [product] was limited to RBAP-MABS banks. What we are doing now is to extend this to all banks… following prescribed conditions and standards,” Mr. Tetangco said.

Philippine Star - The Bangko Sentral ng Pilipinas (BSP) will soon allow all banks to provide microfinancing to the agriculture sector as part of efforts to spur lending in the countryside, BSP Governor Amando Tetangco Jr. said over the weekend.

This as the BSP is expanding the existing program with the Rural Bankers Association of the Philippines (RBAP) dubbed as the Microenterprise Access to Banking Services (RBAP-MABS).

The policy-making Monetary Board approved last week the expansion of the credit program to include all other banks, mostly rural banks that were not part of the previous program.

“It was a limited program but now it will be open to all,” Tetangco told reporters.

Under the program, banks will provide small agricultural farmers these microfinance loans or the so-called high-frequency loans because of the frequent payment schemes. Loan amortization can be as frequent as weekly or monthly.

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