Macra na Feirme president James Healy has said that now is the time to consider the introduction of financial instruments on a pilot basis, particularly for young farmers.

Following a meeting of the rural development monitoring committee, Healy said: ‘‘Financial instruments could take the form of loan guarantees and interest subsidies through the RDP.’’

Indecon consultants highlighted in a presentation to the rural development monitoring committee that ‘‘some market failure exists in the supply of credit to agriculture and fisheries’’ in their ex-ante assessment on the use of financial instruments to promote on-farm investment in Ireland.

Indecon estimates a potential funding gap for capital investment in agriculture of €105m in 2016, rising to nearly €350m by 2025 if the sector expands in line with Food Wise 2025.

Healy said: ‘‘Multiple barriers exist which prevent young farmers from accessing credit to invest on farm. Feedback from Macra na Feirme’s young farmers emphasised market failures such as high interest rates on loans, the duration of the loan and the level of security needed to guarantee a loan – all factors preventing young farmers from accessing credit.’’

The plight of young farmers accessing credit is a European phenomenon, highlighted in a DG Agri survey about the needs of young farmer.

Macra na Feirme has also called for solutions through its membership of CEJA, the European Council of Young Farmers, to address access to credit for young farmers.