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Expanded Rice Credit Assistance Under Rice Competitiveness Enhancement Fund (ERCA-RCEF)

The ERCA-RCEF is a credit facility to support rice farmers, their cooperatives, and for improving the productivity of local rice farmers and increasing their income amidst liberalization of the Philippine rice trade policy.

Eligible Borrowers

    • Individual rice farmers which are listed in the Registry System for basic Sectors in Agriculture (RSBSA)
    • DA-accredited cooperatives with rice farmers as members

Eligible Loan Purpose

Individual Farmers/Member Borrowers

    • Purchase of farm inputs (materials and labor)
    • Acquisition of farm equipment for production and post-production, including mechanical dryers

 Cooperatives

    • Purchase of farm inputs (materials and labor)
    • Working capital
    • Acquisition of machinery and equipment, including mechanical dryers
    • Establishment of facilities for production and post production, processing and trading
    • Relending to small rice farmers listed in the RSBSA for palay production
    • Rediscounting of existing loans of small rice farmers listed in the RSBSA for palay production

To Wholesale Sub-Borrower (relending/rediscounting)

    • Purchase of farm inputs (materials and labor)
    • Purchase of farm equipment for production and post production, and processing

Eligibility Criteria

Individual Farmers/Member Borrowers

    • Registered in the RSBSA
    • No outstanding loan from formal lending institutions and DA-AC{C credit conduits for the same project being applied for
    • NO adverse findings
    • has undergone technical training on palay-related projects

Cooperatives

    • Duly registered with the CDA/SEC
    • Accredited by the DA
    • No adverse findings on the cooperative and its principals
    • Should have strong back support with defined Operational Structure
    • Must exhibit profitable operations and sound financial condition, if start-up must be able to demonstrate profitable operations based on the financial projections of the proposed project for financing
    • Past  Due Loan Ratio not exceeding 25%
    • With Certificate of Compliance from CDA, if applicable
    • Has met the capital requirement of CDA or not less than P30,000.00
    • With proven track record or familiarity on the proposed project
    • Has undergone technical training on rice-related projects.

Eligibility of Member-Borrower

    • Registered with SBDA
    • Account has no history of default with the Cooperative for 3 consecutive months
    • Account for rediscounting is not yet fully paid
    • has undergone technical training on palay-related projects

Loanable Amount

Individual Farmers

    • Loan amount shall be up to 90% of the Total Project Cost (TPC)

Cooperatives

    • For Relending, up to 90% of the total project cost.
    • For Rediscounting, up to 90% of face value of the sub-Promissory Note (PN) or their outstanding balance in current status, whichever is lower.
    • For Project financing, up to 90% of the Total Project Cost.

Interest Rate

    • Direct Lending – 2% per annum
    • On- Lending – 0% per annum. Effective pass-on rate to end users shall not exceed 6% per annum

Collateral Security

For production

    • PCIC insurance proceeds on crops

For acquisition of fixed assets

Any or combination of the following, if applicable/case-to-case basis:

    • Chattel mortgage on subject of financing
    • Applicable insurance cover on the chattel financed endorsed in favor of the Bank.

For establishment of facilities

Any or combination of the following, if applicable/case-to-case basis:

    • Applicable insurance cover on the project financed, endorsed in favor the Bank
    • Real Estate Mortgage (REM)

For relending/rediscounting

Any or combination of the following, if applicable/case-to-case basis:

    • Assignment of sub-borrowers PNs including underlying collaterals, if any
    • Real Estate Mortgage

Assignment of proceeds from insurance/guarantee claims, i.e. PCIC, AGFP and CSF

Documentary Requirements

Individual Farmers

    • Filled-out Loan Application Form
    • Photocopy of one valid government-issued ID or Barangay Certification
    • Sworn affidavit and/or Certification of no outstanding loans from any lending institution/Da-ACPC for the same project

For loans exceeding P3.0 million and/or operating for more than 3 years, DBP may require the following additional documents:

    • A copy of the latest Income Tax Return (ITR) of the borrower and his co-maker, if applicable, duly stamped as received by the Bureau of Internal Revenue (BIR)
    • A copy of the borrower’s latest financial statements as submitted for taxation purposes to the BIR

Cooperatives

    • Accomplished Loan Application Form
    • Certificate of Accreditation from DA
    • Photocopy of Certificate of Registration from the CDA
    • Copies of Articles of Incorporation and By-Laws
    • Bio-data of incumbent officers and Board of Directors with photocopy of valid government-issued ID
    • Board Resolution authorizing the Cooperative to borrow and designating authorized signatories
    • Audited Financial Statement for the last year, or latest interim financial statement for start-ups
    • Business Plan/Consolidated Farm Plan and Budget, if applicable
    • Current year Business Permit

Download Brochure

For inquiries, feel free to contact:

Gracely Lux G. Itum
Program Officer
Program Development and Management II
(02) 818-9511 local 2330
glgitum@dbp.ph

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