Bridging the Agriculture Credit Gap: A Case Study of the Farmer Entrepreneurship Program of Jollibee Group Foundation

Author: Jane Lynn D. Capacio, Emmanuel S. de Dios, and Rob van Tulder

Abstract: Access to credit presents a distinct problem for smallholding farmers and lenders alike. As a consequence, in

the Philippines—as in many other developing economies—a sizable “agriculture credit gap” exists. This paper explores whether it is possible to rethink existing credit arrangements to support inclusive development goals. Our observations are based on a unique in-depth case study of an interlinked financing arrangement in the Farmer Entrepreneurship Program (FEP).
This program is managed by the corporate foundation of Asia’s biggest fast-food chain, Jollibee Foods Corporation (JFC). The lenders in this program are FEP partner-cooperatives that interlink credit, crop buying, and other interventions to enable smallholders to sell their products to JFC and other buyers. For inclusive interlinking to materialize, significant social investments are required from program partners. Using a progressive case study method, three subunits within the study explain how financing can be made available. We use these observations to draw out possible generalizations of financing mechanisms that may be used in other commodity chains. We identify partnerships, particularly long-term relationships, as indispensable requisites for institutional voids to be filled and financing to flow into rural areas. We recommend key government interventions, especially since some of the requisites are in the nature of collective or public goods.

Keywords: interlinked contracts, inclusive value chains, agriculture credit, institutional voids, inclusive interlinked financing, credit gap

Recommended Citation:

Chicago Style:

Capacio, Jane Lynn, Emmanuel de Dios, and Rob van Tulder. 2022. “Bridging the Agriculture Credit Gap: A Case Study of the Farmer Entrepreneurship Program of Jollibee Group Foundation.” Philippine Journal of Public Policy: Interdisciplinary Development Perspectives 2021. https://doi.org/10.54096/AZCZ1645.

American Psychological Association (APA) Style

Capacio, J. L., de Dios, E., & van Tulder, R. (2021). Bridging the agriculture credit gap: A case study of the farmer entrepreneurship program of Jollibee Group Foundation. Philippine Journal of Public Policy: Interdisciplinary Development Perspectives, 2021. https://doi.org/10.54096/AZCZ1645

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