Low-cost loans for up to €500,000 over a maximum of 10 years will be available for on-farm investment in 2019, Minister for Agriculture Michael Creed has said.
“We’re talking about unsecured borrowing over a period of eight to 10 years that is not in the marketplace at the moment,” he told the Oireachtas Committee on Agriculture ahead of next week's Budget 2019 presentation.
“The product won’t be available for draw down until the start of the year” [2019].
Minister Creed said that the next scheme would not be a “repetition” of cashflow loans offered in 2017 at a rate of 2.95%, because competition had been generated by the previous scheme with financial institutions now providing similar loans.
Rate under 5%
While the details of the new scheme have yet to be finalised, Minister Creed said the interest rate was likely to be under 5% with a minimum borrowing of €50,000 and a maximum of €500,000.
It will target young farmers, new entrants and smaller farmers, “for investment purposes rather than working capital.”
Fianna Fáil TD Jackie Cahill said: “It’s very disappointing to be talking about Budget 2019 when commitments made in the 2018 budget haven’t been made.”
Minister Creed contended that there were a number of partners involved in disbursing the €25m earmarked to subsidise the loans: “There are so many moving parts in this latter scheme that we don’t control all the levers on it.”
Merchant credit
It will cover not only farmers, but also "the seafood sector and agri-food businesses," he added.
Asked by Fianna Fáil agriculture spokesperson Charlie McConalogue about a potential hardship fund for farmers hit by this year's bad weather, Minister Creed said he was in early separate discussions with the Strategic Banking Corporation of Ireland (SBCI) on a measure to assist farmers with merchant credit.
Additional reporting by Thomas Hubert.
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Low-cost loans for up to €500,000 over a maximum of 10 years will be available for on-farm investment in 2019, Minister for Agriculture Michael Creed has said.
“We’re talking about unsecured borrowing over a period of eight to 10 years that is not in the marketplace at the moment,” he told the Oireachtas Committee on Agriculture ahead of next week's Budget 2019 presentation.
“The product won’t be available for draw down until the start of the year” [2019].
Minister Creed said that the next scheme would not be a “repetition” of cashflow loans offered in 2017 at a rate of 2.95%, because competition had been generated by the previous scheme with financial institutions now providing similar loans.
Rate under 5%
While the details of the new scheme have yet to be finalised, Minister Creed said the interest rate was likely to be under 5% with a minimum borrowing of €50,000 and a maximum of €500,000.
It will target young farmers, new entrants and smaller farmers, “for investment purposes rather than working capital.”
Fianna Fáil TD Jackie Cahill said: “It’s very disappointing to be talking about Budget 2019 when commitments made in the 2018 budget haven’t been made.”
Minister Creed contended that there were a number of partners involved in disbursing the €25m earmarked to subsidise the loans: “There are so many moving parts in this latter scheme that we don’t control all the levers on it.”
Merchant credit
It will cover not only farmers, but also "the seafood sector and agri-food businesses," he added.
Asked by Fianna Fáil agriculture spokesperson Charlie McConalogue about a potential hardship fund for farmers hit by this year's bad weather, Minister Creed said he was in early separate discussions with the Strategic Banking Corporation of Ireland (SBCI) on a measure to assist farmers with merchant credit.
Additional reporting by Thomas Hubert.
Read more
Almost €145m drawn down in low-cost loans
Bank of Ireland opens €100m fodder shortage loan fund
Further red-tape as 'pre-clearance' required for low-cost loans
Dempsey at Large: loans to farmers almost halve
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