From 2004-2009, the annual proportion of agri-fishery and forestry (AFF) loans to total loans granted by banks was at a low average of 2.5 percent. The limited access to credit by small farmers and fisherfolk, despite the banking sector's reported large amount of funds available for lending, has been due to: (a) the lack of track record among farmers; (b) lack of knowledge on accessing formal or bank financing, particularly putting together the required documents; (c) lack of acceptable collateral; delayed release of loans; and (d) numerous documentary requirements that formal lending institutions require from farmers upon commencement of transactions. On the part of the banks, their aversion to high-risk and low-income agricultural projects, the high cost of administering small loans, and poor repayment performance of agricultural loans, among others, have constrained the provision of credit to farmers and fisherfolk (ACPC, 2010).
Competing uses of agricultural lands. Agriculture, together with the natural resource sector, has been adversely affected by shifts towards competing uses. Particularly sensitive for its implication for food security is the conversion of prime agricultural lands to nonagricultural uses (i.e., residential, commercial and institutional) and the rising demand for industrial crops (e.g., biofuel). Alternative land use activities have also encroached upon ecologically fragile lands. These point to the need for a national land use policy that will rationalize the optimal allocation of land among competing uses.