MANILA – Davao City 1st District Rep. Paolo Duterte on Monday pushed for the passage of a bill seeking to safeguard farmers from usurious lenders.
“It is disheartening that regardless of the invaluable contribution of the farmers to the country’s food security, they remain to be living below the poverty line,” Duterte said.
Duterte, son of former President Rodrigo R. Duterte, filed House Bill (HB) 9094 or the Anti-Usury Against Farmers Act of 2023 on Sept. 7.
The bill, which was tackled at a committee level hearing on Sept. 12, proposes to institutionalize accepted interest rates on the loans of farmers and provides sanctions for those who will violate the measure.
Duterte said the lack of access to formal credit facilities and the excessive interest rates charged by predatory and opportunistic lenders remain among the primordial issues faced by the agricultural sector.
He said among the factors that push poor farmers to the brink of debt include natural calamities, worsening climate change, fluctuating economic forces and unforeseen global pandemic that resulted in the ballooning prices of farming capital and the exposure of agricultural lands to dilapidation.
“As a result, the country’s farmers are faced with unabated losses and financial burden which results in their increased financial vulnerability,” Duterte said.
“It left them with no other choice but to obtain more and more credit from loan sharks in order to secure short-term relief with the hopes of mitigating their losses from the effects of devastating calamities, disrupted economies, and exorbitant farming capital,” he added.
Under the proposed bill, interest on loans to farmers whose landholding does not exceed seven hectares, whether with collateral or without, shall not exceed an effective interest rate of 6 percent per annum.
The same rate shall also apply to the forbearance of any money, good or credit, and in judgments. Any figure above shall be considered usurious and illegal and violators would be fined or penalized with imprisonment. (PNA)