Low-interest funds from the Agri Cashflow Support Scheme which are repaid after 12 or 24 months will not be made available again to the farmer borrower or other farmers. This is despite the scheme running for six years.
The issue has been highlighted by some farmers who point out they have been pushed by their banks to repay their borrowings under the scheme within just one or two years. After that, any borrowings will be at standard, higher interest rates.
The three pillar banks are continuing to process applications from farmers. The Strategic Banking Corporation of Ireland said it was pleased with the interest shown. “We’re seeing really strong interest across the farming community from applicants keen to refinance more expensive overdrafts or merchant credit facilities,” SBCI chief executive Nick Ashmore said. “We will provide an update on loan drawdowns in due course.”
This week the Association of Farm and Forestry Contractors expressed disappointment that contractors are excluded from the scheme, as was confirmed in the Dáil by Minister for Agriculture Michael Creed. “Farm contractors in Ireland could not be any closer to being part of primary agricultural production,” said FCI chair Richard White. “We work on almost every farm in Ireland providing an essential and cost-effective mechanisation service, yet we as contractors with similar cashflow issues to farmers, are excluded from the scheme.”
Irish interest rates high
Irish variable bank interest rates are among the higher rates in the EU, according to an Irish Farmers Journal survey.
Typically, Irish farmers are doing farm development at a variable rate of 4.5% to 4.6% with a 10-year repayment period. Finance is available in France, Germany and Holland at or close to 2%. If that 2.5 to 3 percentage point difference runs over the 10-year loan term, the Irish farmer will repay about €17,000 more to the bank per €100,000 borrowed. Annually the extra interest is about €1,700.
Read more
Full coverage: Agriculture Cashflow Support Loan Scheme
Special focus on agri finance: more competitive interest rates on offer in other European countries
Low-interest funds from the Agri Cashflow Support Scheme which are repaid after 12 or 24 months will not be made available again to the farmer borrower or other farmers. This is despite the scheme running for six years.
The issue has been highlighted by some farmers who point out they have been pushed by their banks to repay their borrowings under the scheme within just one or two years. After that, any borrowings will be at standard, higher interest rates.
The three pillar banks are continuing to process applications from farmers. The Strategic Banking Corporation of Ireland said it was pleased with the interest shown. “We’re seeing really strong interest across the farming community from applicants keen to refinance more expensive overdrafts or merchant credit facilities,” SBCI chief executive Nick Ashmore said. “We will provide an update on loan drawdowns in due course.”
This week the Association of Farm and Forestry Contractors expressed disappointment that contractors are excluded from the scheme, as was confirmed in the Dáil by Minister for Agriculture Michael Creed. “Farm contractors in Ireland could not be any closer to being part of primary agricultural production,” said FCI chair Richard White. “We work on almost every farm in Ireland providing an essential and cost-effective mechanisation service, yet we as contractors with similar cashflow issues to farmers, are excluded from the scheme.”
Irish interest rates high
Irish variable bank interest rates are among the higher rates in the EU, according to an Irish Farmers Journal survey.
Typically, Irish farmers are doing farm development at a variable rate of 4.5% to 4.6% with a 10-year repayment period. Finance is available in France, Germany and Holland at or close to 2%. If that 2.5 to 3 percentage point difference runs over the 10-year loan term, the Irish farmer will repay about €17,000 more to the bank per €100,000 borrowed. Annually the extra interest is about €1,700.
Read more
Full coverage: Agriculture Cashflow Support Loan Scheme
Special focus on agri finance: more competitive interest rates on offer in other European countries
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