The DA Accessible Loans for Empowered, Resilient, and Transformed Agrarian Reform Beneficiary Organizations (ALERT ARBOs) Program is a government initiative designed to provide timely and affordable financial assistance to Agrarian Reform Beneficiary Organizations (ARBOs) and their members. Established as an enhancement of the Agrarian Production Credit Program (APCP) in 2020, the program is jointly implemented by the Department of Agriculture (DA), Agricultural Credit Policy Council (ACPC), Department of Agrarian Reform (DAR), Land Bank of the Philippines (LANDBANK), and Department of Environment and Natural Resources (DENR). It operates under a framework that aligns with national agricultural and agrarian reform policies, aiming to strengthen the financial capacity of ARBOs and promote inclusive agricultural development.
Access to agricultural credit is a major challenge for farmers, which is why programs like ALERT ARBOs are important in ensuring that smallholder farmers and agripreneurs have access to capital for production, processing, and marketing. Through short-term and long-term loan facilities, the program helps ARBOs and their members finance their agricultural projects, acquire essential farm equipment, and improve their livelihoods. Understanding how to apply for the ALERT ARBOs Program is crucial for farmers and agrarian reform beneficiaries looking to expand their farming operations and contribute to the country’s agricultural growth. To help you out, we listed everything you need to know about applying for and getting the benefits offered by the DA via the ALERT ARBOs Program.
Program Overview and Features
The DA, in collaboration with the ACPC, the DAR, the DENR, and Landbank, offers the ALERT ARBOs Program to provide financial assistance to ARBOs and their members and support agricultural production, agribusiness ventures, and farm-related activities. The program offers the following features:
Credit Facilities:
- Short-Term Loan Line (STLL)
- Best For: ARBOs looking for a revolving credit facility to finance short-term agricultural projects and provide members with accessible funds.
- Purpose:
- Provides working capital to ARBOs for on-lending to Agrarian Reform Beneficiaries (ARBs) and their household members.
- Supports short-term agricultural activities like production, post-harvest, and marketing.
- Loan Term: Short-term in nature, usually within one production cycle or up to one year.
- Interest Rate: Fixed at 5% per annum, subject to adjustments by the National Program Management Committee (NPMC).
- Who Can Avail: ARBOs that need funds to distribute as sub-loans to their members.
- Term Loan (TL)
- Best For: ARBOs and ARBs planning to invest in agricultural enterprises, farm mechanization, and processing facilities
- Purpose:
- Funds larger, long-term agricultural and agribusiness investments.
- Can be used for acquiring fixed assets, infrastructure, farm machinery, and facilities.
- Loan Term: Medium to long-term repayment, typically over several years depending on the project size and nature.
- Interest Rate: 5% per annum or as determined by the NPMC.
- Who Can Avail: ARBOs and their members who need capital for expansion and infrastructure investments.
- Short-Term Loan (STL)
- Best For: Individual ARBs or small-scale agripreneurs needing immediate working capital for seasonal farming or agribusiness.
- Purpose: Similar to STLL but focuses on specific short-term needs, including seasonal farm inputs, small equipment, and minor capital expenditures.
- Loan Term: Typically less than a year, aligned with a single cropping or production cycle.
- Interest Rate: Same as STLL and TL, fixed at 5% per annum, unless revised by the NPMC.
- Who Can Avail: ARBOs, ARBs, and ARB household members needing quick financial support for short-duration projects.
Loan Amount and Interest Rates:
- Fixed interest rate of 5% per annum for STLL and TL, subject to adjustments approved by the National Program Management Committee (NPMC).
- Maximum pass-on rate of 10% per annum for end-borrowers, inclusive of other charges.
Loan Repayment and Penalties:
- Grace period of 60 days before penalties apply.
- 3% annual penalty on late payments based on unpaid principal and interest.
Collateral Requirements:
- Real estate mortgage (if applicable).
- Security interest on the object of financing (if applicable).
Loan Purposes
The loan proceed can be used as follows:
For ARBOs:
- Additional working capital for on-lending to ARB members and their households.
- Financing for ARBO-managed agricultural projects, including production, post-production, and marketing initiatives.
For ARBs and ARB Household Members:
- Agricultural and fisheries production, including rice, corn, high-value crops, livestock, poultry, and aquaculture.
- Enterprise projects such as trading, marketing, and processing of agricultural goods.
- Purchase of small farm equipment like hand tractors, irrigation pumps, and transplanters.
Benefits
The program not only offers numerous financial and operational benefits to Agrarian Reform Beneficiary Organizations (ARBOs) and their members, but also long-term opportunities for growth, improving the sustainability of their agricultural enterprises.
- Affordable Financing: Low-interest loans at a fixed 5% per annum, making it easier for farmers to access capital.
- Flexible Loan Options: Various credit facilities, including Short-Term Loan Line (STLL), Term Loan (TL), and Short-Term Loan (STL), to suit different financial needs.
- Access to Working Capital: Funds available for production, post-harvest, marketing, and agribusiness expansion.
- Support for Farm Equipment Acquisition: Financing for tractors, transplanters, irrigation pumps, and other essential farm machinery.
- Stronger ARBOs: Increased financial stability for farmer cooperatives, associations, and people’s organizations.
- No Outstanding Loan Requirement: Eligible ARBOs must have no existing loans with LANDBANK for the same project, ensuring fair access to funds.
- Capacity Building & Support Services: Includes agricultural insurance, technical assistance, and marketing support for more sustainable operations.
- Improved Agricultural Productivity: Helps ARBs and agripreneurs expand their businesses and increase farm output, contributing to food security and rural development.
Who Can Apply?
Eligible Borrowers include:
- Farmers’ cooperatives, associations, and people’s organizations registered with the Cooperative Development Authority (CDA) or the Securities and Exchange Commission (SEC).
- ARBOs with a majority (50% +1) of their members being Agrarian Reform Beneficiaries (ARBs) or their household members.
- Organizations with at least one year of operation, as demonstrated by audited financial statements and regular meeting minutes.
- ARBOs with a net past-due ratio not exceeding 25% and with established lending systems and procedures.
- ARBOs with no outstanding loans from LANDBANK or other formal lenders for the same project.
Eligible Sub-Borrowers:
- ARBs
- Household members of ARBs
Qualifications
To qualify for the program, ARBOs and their members must satisfy the following criteria to ensure their financial and operational capacity for loan management.
- Registered Legal Entity: Must be registered with the Cooperative Development Authority (CDA) or the Securities and Exchange Commission (SEC).
- ARB-Majority Membership: At least 50% + 1 of the members must be Agrarian Reform Beneficiaries (ARBs) or ARB household members.
- Operational for at Least One Year: Must provide audited financial statements and meeting records from at least four regular meetings in the past year.
- Profitable Track Record: Must have shown at least one year of profitable operations before the March 15, 2020, COVID-19 lockdown, as evidenced by financial records.
- Qualified Leadership Team: Must have a core management team, including a manager, treasurer/cashier, and bookkeeper.
- Acceptable Credit Standing: Must have a net past-due loan ratio of not more than 25% and no adverse findings on the ARBO and its key officers.
- Established Systems & Procedures: Must have lending operations systems in place for loan management and repayment tracking.
- No Outstanding Loans for the Same Project: ARBOs must not have an existing loan from LANDBANK or other formal lending institutions for the same proposed project.
- Familiarity with the Proposed Project: For new ventures, key officers must have relevant experience or training in the proposed business activity.
Required Documents
Interested applicants are expected to prepare and submit the following documents to verify their eligibility and complete their loan application requirements.
Legal and Organizational Documents:
- Certificate of Registration from the Cooperative Development Authority (CDA) or Securities and Exchange Commission (SEC)
- Articles of Cooperation and By-Laws (for cooperatives) or Articles of Incorporation (for associations)
- Board Resolution authorizing the loan application and designating signatories
Financial and Operational Records:
- Audited Financial Statements for the past year
- Minutes of Meetings (at least four regular meetings from the past 12 months)
- List of Officers and Members, including their ARB/ARB household membership status
- Business Plan or Project Proposal, detailing the loan purpose and expected outcomes
- Proof of Business Operations, such as tax records, sales reports, or other financial documents
Credit and Loan Compliance Documents:
- Certificate of Good Standing from CDA or SEC
- Certification of No Outstanding Loan for the same project from LANDBANK or other formal lenders
- Proof of Compliance with the required net past-due ratio (not exceeding 25%)
Note: Preparing these documents in advance will help ensure a smooth application process and faster loan approval for eligible ARBOs and their members.
How to Apply?
To apply, you simply need to follow these steps:
Step 1: Check Eligibility
Confirm that the ARBO or individual meets the program’s criteria.
Step 2: Prepare Required Documents
Gather financial statements, registration certificates, and records of past operations.
Step 3: Submit an Application
Applications must be filed through designated LANDBANK branches or program partners.
Step 4: Loan Evaluation
The lending institution will assess the ARBO’s financial capacity and project viability.
Step 5: Approval and Release
Approved loans will be disbursed through LANDBANK or other authorized channels.
Video: AgriCredit Talks – Insurance Protection
The ALERT ARBOs Program serves as a financial lifeline for agrarian reform beneficiaries and their organizations, facilitating access to affordable loans to improve agricultural productivity and agribusiness operations. The loan proceeds can be used to fund production, post-harvest processing, and farm equipment purchase and support the growth and sustainability of the agriculture sector in the Philippines. However, unexpected events can always occur, so you also need to know about how to protect yourself and your agribusiness ventures from damages caused by calamities.
To learn more about this, watch this video from ACPC:
Contact Information
For inquiries and further details, applicants may contact:
Agricultural Credit Policy Council (ACPC)
- 28th Floor, One San Miguel Avenue Building, San Miguel Avenue cor. Shaw Boulevard, Pasig City, 1605 Philippines
- Tel: (02) 8634-3320 to 21 / (02) 8634-3326
- Fax: (02) 8634-3319
- Email: info@acpc.gov.ph
- Website: https://acpc.gov.ph/