The Solana West Farmers’ Cooperative (SOWESFACO) in Solana, Cagayan, is revolutionizing agricultural finance with the support of the Land Bank of the Philippines (LANDBANK), introducing an innovative “payment-in-kind” system for loan repayment. This groundbreaking approach allows smallholder farmers to repay their loans using their harvested palay (unmilled rice) instead of cash.
This flexible system offers significant advantages to SOWESFACO members, providing them with greater control over their finances, particularly during periods of low cash flow. By allowing loan repayment with their produce, farmers are shielded from the pressures of fluctuating market prices and gain more stability in their income. This innovative solution aligns financial obligations with the natural cycles of farming, fostering a more resilient and sustainable livelihood for rural communities.
“This ‘payment-in-kind’ system is a game-changer for our members,” says Christopher Barlaan, SOWESFACO general manager. “It addresses the real challenges that farmers face, especially when market prices are unfavorable or during the lean season. By partnering with LANDBANK, we are empowering our community to thrive,” he added.
LANDBANK’s support has been instrumental in the implementation of this novel approach. By understanding the unique needs of the agricultural sector, LANDBANK is demonstrating its commitment to providing tailored financial solutions that promote inclusive growth and rural development.
LANDBANK is proud to collaborate with SOWESFACO in pioneering this ‘payment-in-kind’ system. This initiative reflects the bank’s dedication to supporting farmers and strengthening agricultural communities. By aligning financial solutions with the realities of farming, LANDBANK is helping build a more sustainable future for the sector.
The success of this initiative in Solana, Cagayan, serves as a model for how financial institutions and agricultural cooperatives can work together to create innovative solutions that directly address the needs of smallholder farmers. Through this partnership, every grain of rice harvested is not just a yield, but a step towards lasting progress and financial empowerment for the rural communities of Solana.
