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September 4, 1997



SUBJECT    :     Supplemental Guidelines on the Implementation of Credit Assistance Program for Program Beneficiaries Development (CAP-PBD)



The DAR and Land Bank of the Philippines through a Memorandum of Agreement signed on 09 September 1996 agreed to jointly implement the Credit Assistance Program for Program Beneficiaries Development (CAP-PBD). To effect its implementation, the DAR issued Memorandum Circular No. 26, series of 1996, Implementing Policies and Guidelines on the Availment of CAP-PBD on 25 October 1996. Likewise, the LBP issued Credit Group Memo Circular No. 97-001. These two documents contain the same guidelines on CAP-PBD fund availment.   AEIcTD

On February to March 1997, the CAP-PBD National Technical Review Committee (NTRC) and Program Secretariat (PS) conducted CAP-PBD Orientation Cum Planning Session for the DAR and LBP field implementors. This activity was conducted in four batches covering 25 provinces in 10 regions with a total of 183 participants. Selection of the focus areas are based on the number of LAD-free ARCs and ARCs with 76-99% LAD-accomplishment.

In this activity, relevant issues and concerns were raised by the participants which necessitate policy formulation to hasten, the implementation of CAP-PBD. Hence, this guideline is formulated as addendum to the provisions contained in MC No. 26, series of 1996.


2.1       Renaming of LBP Field Offices

           Due to LBP's implementation of Unified Systems Project in 1996, some officials/offices involved in CAP-PBD implementation are renamed as follows:


(Per MC No. 26-96/Credit Group

Memo No. 97-001)

Executive Vice-President             Executive Vice-President

Agrarian Sector                           Agrarian-Domestic Banking Sector

Senior Vice-President                  Senior Vice-President

Field Operations Group               Domestic Banking Sector

Head                                           Assistant Vice-President

Field Loans and Review               Cooperative Loans Department

Department (FLRD)                    (CLD)

Field Office Manager                   Branch Manager

Zone Manager                             Regional Manager


Cluster Head

2.2       Organization And Management

A.        Membership of the National Technical Review Committee (NTRC)

           The LBP Assistant Vice-President of the Cooperative Loans Department (CLD) shall be the Vice-Chairperson of the NTRC, while the Manager of the Integrated Rural Financing (IRF) remains as member of the NTRC.

           The LBP Cluster Head shall be required to sit in the NTRC during deliberation of projects (over P5 Million) depending on where the project originates.

B.        Regional Project Management Committee and Provincial Project Management Committee

           The DAR Regional Support Services Division (SSD) and Provincial Beneficiaries Development Coordination Division (BDCD) shall be the designated program secretariat for the RPMC and PPMC, respectively.   AaCEDS

2.3       Equity Participation Of The Proponent

           Equity of the proponent shall include not only cash and labor but also other assets such as land, building and materials owned by the proponent which will be used in the implementation of the proposed project.

2.4       Rebate

           The proponent cooperatives will be encouraged to use the 3% rebate (granted upon prompt full payment of the loan) as additional capital build-up of the proponent.

2.5       Procedures Of Fund Availment

A.        Accreditation

           For newly-organized cooperatives (i.e., cooperatives organized one year prior to loan application), any of the following documents may be submitted in lieu of the audited financial statements:

a)         interim financial statement certified by a local accountant; and

b)         certification from the Office of the Mayor (Local Government Unit) that the cooperative has just started its operation.

           In the accreditation of farmers organizations registered in SEC or BRW, organizational assets worth P15,000.00 shall be used instead of the required P15,000.00 capital build-up.

B.        Process Flow and Timeframe

           Annexes A1 to A3 of this Guideline presents the flow of activities in the availment of funds under CAP-PBD and the corresponding timeframe for each activity.

           The set timeframe from evaluation of project proposal to release of loan to the proponent cooperative or farmers' organization is indicated below:

AMOUNT             APPROVING            MINIMUM           MAXIMUM

                                                           AUTHORITY                         NO. OF DAYS            NO. OF DAYS

Below P2 M                      PPMC                           13                           22

Over P2M up to P5M        RPMC                           17                           28

Over P5 M                        NPMC                           21                           35

All orders, memoranda, circulars and issuances inconsistent herewith are hereby amended or repealed accordingly.   HaDEIc

This Memorandum Circular shall take effect immediately.

Diliman, Quezon City, September 04, 1997.




Secretary, DAR



President, LBP





Department of Agrarian Reform
Elliptical Road, Diliman
Quezon City, Philippines
Tel. No.: (632) 928-7031 to 39

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