Outstanding woman in agri
March is National Women’s Month. A fitting way to commemorate this is to feature an outstanding woman in agriculture and her groundbreaking initiatives making credit more accessible to farmers and fisherfolk.
Agriculture is critically important. It employs 30 percent of our workforce and contributes to our gross domestic product (10 percent directly and 35 percent indirectly). Still, and most significantly, it has the highest poverty level at 36 percent. It is lamentable that only 2 percent of our financial institutions’ loanable fund goes to agriculture. This has been the same situation for decades.
However, there is a light to help address this dismal picture. On Jan. 9, 2017, Cecilia Borromeo was appointed president of the Development Bank of the Philippines (DBP).
When the five coalition Agri-Fisheries Alliance (AFA) discussed the sad state of agriculture credit with Finance Secretary Carlos Dominguez III, he told AFA to first talk to Borromeo.
Last March 1, AFA’s credit champion Danny Fausto (a former banker and 2016 Agri-Entrepreneur of the Year) led the discussion with Borromeo. But who is Borromeo?
Agriculture orientation. After graduating with an Agribusiness degree at UP Los Baños, Borromeo endeavored to bring a business orientation to agriculture. After her brief stints promoting livelihood at the former Ministry of Human Settlements and then years after at the Department of Trade and Industry (working directly under current Secretary Ramon Lopez), she joined the agriculture lending section of the Land Bank of the Philippines.
From there, she rose to become Landbank’s executive vice president for institutional banking and subsidiaries. She never forgot agriculture, giving special attention to lending institutions which did subcontracting to small farmers. Examples are San Miguel Corp. and Bounty Fresh Group of Companies.
After three years in this position, Borromeo chose to spend more time serving directly more small farmers and fisherfolk. She became executive vice president for agriculture and development lending. She revolutionized this area. Her innovations resulted in an impressive 89-percent loan increase—from P233.1 billion in July 2012 to P421.5 billion in June 2016.
DBP initiatives. Upon taking the top DBP position a year ago, Borromeo immediately implemented noteworthy credit initiatives. Although DBP has 125 branches, she found out that cooperatives and small and medium enterprises (SMEs) had great difficulty accessing loans.
At the provincial level, proponents submit loan applications that still need to be forwarded to the DBP main office for approval. This is a tedious and difficult process that often results in rejections. Decentralization was the answer.
First, Borromeo established 22 lending centers in key provinces. They were created to focus on loans for coops (where the farmers and fisherfolk are) and SMEs (where agri-processors and agri-marketers are).
Second, to make the decentralization effective, she placed high-level banking professionals that would make final decisions without having to rely on the head office.
Third, using the value-chain approach from “seed-to-shelf,” she formulated lending program guidelines for each commodity. For example, for the poultry sector, she formulated a guideline by which lending decisions would depend on the different product cost ranges.
Borromeo said: “Just as there is a set menu from Jollibee or McDonald’s to make more efficient the delivery of a meal, so will there now be a lending model for the most common commodities in a given area. This would help the loan proponent prepare a better financial proposal, while at the same time help the bank manage risks.”
Conclusion. We believe this approach that Borromeo started is the key to our perennial problem of inaccessible credit. The challenge is not that there are inadequate funds for agriculture. Rather, there are not enough properly prepared agriculture loan proposals nor are there enough accessible properly trained agriculture lending officers. Other banks should consider adopting the new approach that DBP is implementing. For details on the program, contact Aurora Maghirang at (02) 812-8088.
We have here an outstanding woman in agriculture and her significant contributions to agriculture lending. There are many such stories of women that remain unheard, unrecognized and unappreciated. It’s time their stories are made known.
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