In a bid to revitalize the agricultural sector and uplift the lives of Filipino farmers, BPI Direct BanKo, the microfinance arm of Bank of the Philippine Islands (BPI), and Agrilever, a leading provider of mobile applications for farmland and farmer data, have joined forces to offer a revolutionary agricultural loan program.

This initiative aims to bridge the financial gap faced by small-scale farmers by providing them with accessible credit and the technological tools needed to increase their productivity and profitability.

The Philippines has a rich agricultural heritage, yet the industry faces significant challenges. 

BPI president and CEO, TG Limcaoco, highlighted a crucial factor: a decline in participation within the sector. “Agriculture is the oldest profession in the world,” he stated, “and it started when you didn’t need credit because it was only your sweat and nature that got you.” However, Limcaoco emphasized the need for change, stating, “With people leaving agriculture, we need to make it more efficient, and the only way to make it efficient is you need to provide credit.”

Pressing need for change

The partnership between BPI Direct BanKo and Agrilever addresses this need directly. Agrilever acts as a bridge, connecting individual farmers with BPI Direct BanKo while simultaneously empowering them to achieve higher profits through their mobile application.  “We invest in their abilities to be able to provide food on our table, thereby we’re investing in the Philippines,” declared BPI Direct BanKo president Rodolfo Mabiasen Jr.

Agrilever’s mobile app offers a comprehensive suite of tools designed to enhance agricultural practices and optimize yields. Farmers gain access to:

• Weather forecasts: Crucial information for informed decision-making regarding planting schedules and resource allocation;

• Soil health analysis: Insights into the condition of their land, enabling them to tailor fertilizer application and improve soil fertility;

• Water condition monitoring: Data on water availability helps farmers manage irrigation efficiently, ensuring optimal crop growth; and

• Pest alerts: Timely warnings equip farmers to take preventative measures and safeguard their crops from potential damage.

Beyond production support, the app facilitates market access by connecting farmers directly with merchants.

This valuable feature helps reduce reliance on middlemen and ensures farmers receive a fairer share of the profits.

Arthur Yap, Agrilever co-founder and former secretary of Agriculture, explained the app’s core objective: “This is what we’re trying to do, to give instructions that are specific to individual farmers. We ensure that you are bankable and profitable.”

Financial inclusion via affordable credit

The program offers a significant advantage to farmers through substantially lower interest rates. Mabiasen highlighted the stark contrast between the program’s rate and the exorbitant rates often charged by informal lenders.

“We offer an affordable interest rate of about 2.3 percent monthly compared with up to 20 percent charged often by middlemen,” he stated.

This reduction in borrowing costs frees up valuable resources for farmers, allowing them to invest in better-quality seeds, fertilizers, and equipment, ultimately leading to higher yields and improved livelihoods.

Expanding reach, impact

With the support of Agrilever’s technology, BPI Direct BanKo aims to significantly increase its reach within the agricultural sector. 

Mabiasen revealed their ambitious target: “With the help of Agrilever, he said BanKo aims to increase its farmer borrowers from 10,000 to 30,000 in the initial period of their partnership.”

This expansion has the potential to transform the lives of countless Filipino farmers, empowering them to become more productive, financially secure, and integral contributors to the nation’s food security.

The BPI Direct BanKo-Agrilever partnership represents a significant step towards financial inclusion within the Philippine agricultural sector.

By providing accessible credit and fostering technological adoption, this initiative empowers small-scale farmers to overcome financial constraints and unlock their full potential.

As the program scales, it has the potential to revitalize the agricultural industry, boost rural livelihoods, and ensure a more sustainable future for Filipino agriculture.

Challenges, opportunities

Despite the program’s promising outlook, challenges remain.  According to Bangko Sentral ng Pilipinas, a staggering 73 percent of farmers and agricultural workers in the Philippines lacked access to bank accounts in 2021.

This highlights the need for continued financial literacy initiatives and infrastructure development to ensure the program’s long-term success.

Looking ahead, the collaboration between BPI Direct BanKo and Agrilever presents a unique opportunity to bridge this gap and empower Filipino farmers. By combining financial resources with innovative technology.