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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
NINETEENTH CONGRESS 
2nd Regular Session 
House Bill No. ________ 
Introduced by Representatives ERIC G. YAP and EDVIC G. YAP 
EXPLANATORY NOTE 
Several phenomena such as inevitable natural calamities, worsening climate change, 
fluctuating economic forces and unforeseen global pandemic has led to the ballooning 
prices of farming capital and the exposure of agricultural lands to dilapidation.  Faced 
with unabated losses and financial burden, the country’s farmers have suffered 
increased vulnerability forcing them to resort to loan sharks and opportunistic lending 
entities for short term relief. In addition to this is the lingering reality that the country’s 
farmers remain to be living below the poverty line despite their invaluable 
contribution to the country’s food security. 
The lack of access to formal credit facilities and excessive interest rates charged by 
predatory lenders remain as one of the primordial issues faced by the agricultural 
sector. The plight of farmers caught in the debt trap and shadow bankers are left with 
no choice but to take more and more credit to loan sharks in order to afford temporary 
relief to mitigate compounding losses from devastating calamities, disrupted 
economies, and exorbitant farming capital. The Philippine Institute of Development 
Studies (PIDS) shows that despite the proliferation of government-directed credit 
programs and the significant amount of government funds spent for the 
implementation of the said programs, the poor farmers or the supposed target 
beneficiaries still do not have access to fair and equitable credit and are still dependent 
to informal lenders who charge unreasonable interest rates. One main reason, 
according to the report, is that despite the existing government facilities for low-cost 
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credit to small farmers, many of them do not take advantage of the credit facilities due 
to lack of collateral to secure loans and lack of awareness or familiarity with the 
processes and requirements needed. 
It is in this regard that this bill seeks to protect the country’s farmers from usurious 
lenders, marked by excessive loan interest rates and unauthorized lending practice, 
through the institutionalization of a regulated, uniform, and accepted interest rates on 
the loans of farmers and providing sanctions for those who will violate such proposed 
measure.  
In view of the foregoing, approval of this bill is earnestly sought. 
HON. ERIC G. YAP 
HON. EDVIC G. YAP


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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
NINETEENTH CONGRESS 
2nd Regular Session 
House Bill No. ________ 
Introduced by Representatives ERIC G. YAP and EDVIC G. YAP 
AN ACT 
PROHIBITING USURIOUS LENDING TO FARMERS, APPROPRIATING 
FUNDS THEREFORE AND FOR OTHER PURPOSES 
Be it enacted by the senate and the House of Representatives of the Philippines in Congress 
assembled: 
           SECTION 1. Title. - This Act shall be known as "Anti-Usury Against Farmers 
Act of 2023." 
           SECTION 2. Declaration of Policy. - Article II, Sec. 9 of the 1987 Constitution 
states, "The State shall promote a just and dynamic social order that will ensure the 
prosperity and independence of the nation and free the people from poverty through 
policies that provide adequate social services, promote full employment, a rising 
standard of living, and an improved quality of life for all." In support of this policy, 
the State further shall ensure that our farmers shall not become victims of usurious 
lenders and practices. 
           SECTION 3. Application of Interest Rates. –  Interest on loans to farmers whose 
landholding does not exceed seven (7) hectares, whether with collateral or without, 
shall not exceed an effective interest rate of six per cent (6%) per annum. The same 
rate shall likewise apply to forbearance of any money, good or credit, and in 
judgments. Any figure above this shall be considered usurious and illegal. 
           SECTION 4. Restructuring the Balance of Existing Loans. – The balance of 
existing loans shall automatically be restructured applying an interest rate not 
exceeding an EIR of 6% per annum, effective upon effectivity of this Act. 
           SECTION 5. Determination of Loanable Amounts. – The Bangko Sentral ng 
Pilipinas and the Monetary Board shall determine the amount, or the percentage of 
loanable amounts to farmers in the portfolio of banks, public or private. 
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           SECTION 6. Implementing Rules and Regulations. - The Department of 
Finance shall formulate the rules and regulations of this Act within ninety (90) days 
of its effectivity. 
 
           SECTION 7. Penalty. - Any natural person, not a government official or 
employee, who violates any provision of this Act shall be punished with 
imprisonment of one (1) year and/or a fine not exceeding One Hundred Thousand 
Pesos (P 100,000.00). 
 
           Any government employee or official who violates any provision of this Act 
shall be punished with imprisonment of two (2) years and/or a fine not exceeding 
Two Hundred Thousand Pesos (P 200,000.00). 
 
           Any juridical person who violates any provision of this Act shall be punished 
with a fine of Five Hundred Thousand Pesos (P 500,000.00). Its directors and/or 
officers may also be punished with imprisonment of six (6) months to one (1) year if 
found liable of a violation under this Act. 
 
           SECTION 8. Repealing Clause. - All acts, decrees, letters of instruction, 
issuances, orders, or parts thereof inconsistent with any provision of this Act are 
hereby deemed repealed or modified accordingly. 
 
           SECTION 9. Separability Clause. - If any part of this Act is declared 
unconstitutional, the rest of the provisions shall remain in force and effect. 
 
           SECTION 10. Effectivity. - This Act shall take effect 15 days after its publication 
in two newspapers of general circulation or in the Official Gazette. 
 
 
Approved,