ACTIVITY IN AGRICULTURAL FINANCE

An Activity Presented to

the faculty of the

College of Agriculture, Forestry and Environmental Sciences

AKLAN STATE UNIVERSITY

Banga, Aklan

In Partial Fulfillments

Of the Requirement for the Degree

BACHELOR OF SCIENCE IN AGRICULTURE

(Agricultural Economics)

By

Mark Oliver T. Hilario

 I. RATIONALE:

Borrowing money refers to the act of obtaining funds from a

lender, often a financial institution or an individual, with the

understanding that the borrowed funds will be repaid at a later

date, usually with interest or other agreed-upon terms. People

borrow money for various reasons, such as purchasing a house,

starting a business, paying for education, or covering unexpected

expenses. When it comes to borrowing money, there are different

types of loans Such as; Personal Loans, Mortgage Loans, Auto

Loans, Student Loans and Business Loans. It is crucial to

consider several factors When borrowing money such as its

Interest Rates, Repayment Terms, Fees, Charges, Creditworthiness

and Repayment Capability

Borrowing money should be done responsibly, with careful

consideration of your financial situation, repayment

capabilities, and long-term goals.

II. DEMOGRAPIC PROFILE OF THE INTERIEWEE

NAME: Orbilly R. Hilario

AGE: 44

OCCUPATION: Businessman

YEAR IN BUSINESS: 14 Years

III. INTERVIEW SCHENDULE

 1. How much Amount of Borrowed Money did you Borrowed?

HE BORROWED THE AMOUNT OF P100,000.00 FROM MERICRIS RAMIREZ

(SISTER) SINCE JANUARY 2022

2. Where di you use the Borrowed Money

THE PURPOSE OF BORROWING IS TO CONTINUOUSLY OPERATE HIS

BUSINESS IN ORDER TO GENERATE INCOME IN ORDER TO SUPPORT

EVERYDAY NEEDS

3. What are the interest charge and duration of due of your

borrowed money?

THE INTEREST CHARGED WILL BE 1% WHICH IS WORTH P1000.00 OF

INTEREST AND TO BE PAID WITHIN 1 YEAR

IV. ADVANTAGES AND DISADVANTAGES

ADVANTAGES:

 It allows you to bridge the gap between your financial needs

and your available resources. Financial Flexibility makes a

significant purchases or investments that may not be

feasible with your current savings.

 In such situations, borrowing money can be a lifeline to

cover unexpected expenses, such as medical bills, urgent

Infrastructure repairs, or car repairs.

 Through borrowing, you can leverage your resources and

potentially achieve higher returns on your investments.

Borrowing money can provide opportunities for growth, such

 as starting or expanding a business, investing in education,

or purchasing a property.

 Responsible borrowing and timely repayments can help you

build a positive credit history. A good credit score can be

advantageous when applying for future loans, as it

demonstrates your creditworthiness to lenders, potentially

leading to better interest rates and loan terms.

DISADVANTAGES:

 Failure to make loan repayments can lead to a growing debt

burden, accumulating interest, late payment fees, and damage

to your credit score. Borrowing money means taking on debt,

and it's important to consider your ability to repay the

borrowed amount.

 Interest rates can vary, and if they are high, it can

significantly increase the total cost of borrowing, making

it more challenging to repay the loan. When borrowing money,

you must repay not only the principal amount but also the

interest charged by the lender.

 Borrowing money comes with financial obligations, such as

monthly repayments. These obligations can put added strain

on your budget, reducing your disposable income and limiting

your financial flexibility. It is essential to evaluate your

 current and future financial situation to ensure you can

comfortably meet the repayment obligations.

 Lenders may also have conditions, collateral requirements,

or eligibility criteria that you need to meet, which can

limit your options. Borrowing money requires finding a

willing lender. Depending on the type of loan and your

creditworthiness, it may be challenging to secure favorable

loan terms or even obtain a loan at all.

 Borrowing money can divert a portion of your income towards

loan repayments, potentially affecting your ability to save

for long-term goals, such as retirement or education. It is

crucial to consider the impact of borrowing on your overall

financial plan and ensure that it aligns with your goals.

CONCLUSION

To Sum up, borrowing money can be advantageous when used

prudently and responsibly, but it also comes with potential

drawbacks. It is important to carefully assess your financial

situation, consider the alternatives, and evaluate the terms and

conditions of borrowing before making a decision.