Credit to small farmers.
Section 13
SEC. 13. Credit to small farmers.—Credit extended to small farmers, either with titles or no titles over their lands, whether tenants or part owners, should be based upon the anticipated productive capacity of farmers insofar as repayment probabilities are concerned: Provided, however, that the amount does not exceed two thousand pesos. Such loans may be granted for the purchase of fertilizer, seed, feed, work animals and corresponding tillage equipment, poultry, livestock and such other items specified by regulations as are directly related to the production of crops and livestock. The ability of such a borrower to provide security in the form of land or other tangible securities should not be the primary deciding factor in approving or disapproving a loan. Instead, the size of the loan should be predicated upon his production with other security being considered as supplemental. In instances where credit is extended for items which are not consumed in their use, such items should be pledged as security, but in such cases approval of the loan should be dependent upon the borrower's productive capacity after receiving the item rather than upon the return which can be anticipated in the event of forced sale of the item. Loans made to farmers should be conditioned upon compliance by them with those proven practices which are reasonably within their capacity to carry out and will result in the maximum income and production from such farming units. The supervision necessary to insure full implementation of this policy will be maintained by the Administration.