Imagine you are given a bicycle so you can go to school. That's good—but what if you don't have money for repairs, fuel for a motorbike, or safety gear? The bicycle alone may not be enough.
The same is true for farmers. Giving them land is important, but they also need money, training, equipment, and support to make their farms productive.
That is what Republic Act No. 11901, or the Agriculture, Fisheries and Rural Development Financing Enhancement Act of 2022, tries to do. It helps farmers, fisherfolk, and agrarian reform beneficiaries (ARBs) gain better access to loans and financial services so they can improve their livelihoods.
What does the law require?
Banks are encouraged and required to support agriculture, fisheries, and rural development by providing financing for:
- Farming and fishing activities
- Farm machinery and equipment
- Food processing and marketing
- Rural businesses
- Modern technologies and digital agriculture
- Environmental and climate-friendly projects
What happens if banks do not comply?
If banks fail to meet the required financing targets, they must pay penalties. Instead of letting the money sit idle, the law creates a Special Fund from these penalties.
Why does DAR receive 35% of the Special Fund?
Many farmers under agrarian reform were given land through a Collective Certificate of Land Ownership Award (Collective CLOA). This means a large piece of land was awarded to a group of farmers together.
Think of it like five siblings inheriting one big cake without clearly marking each person's slice.
This can create problems:
- Unclear boundaries
- Disagreements among owners
- Difficulty obtaining loans
- Complicated land records
To solve this, DAR divides the land into clearly defined individual parcels and issues individual titles to each farmer. This process is called parcelization and titling.
Because this work is expensive, RA 11901 provides that 35% of the Special Fund shall be allocated to DAR for the titling and parcelization of landholdings covered by collective CLOAs.
With individual titles:
- Farmers know exactly which land is theirs.
- Land disputes are reduced.
- Government services are easier to deliver.
- Farmers may find it easier to access formal financing.