IFA welcomes ‘important facility’ for farmers with Covid credit scheme
The roll-out of the €2 billion Covid-19 Credit Guarantee Scheme, and its inclusion of farmers and agri-businesses, has been welcomed by the Irish Farmers’ Association (IFA), which has referred to it as an “important facility for farm business”.
The Credit Guarantee Scheme will be launched today (Monday, September 7), under which farms and farm businesses impacted by the pandemic can apply for low-cost loans.
The scheme was welcomed by Tim Cullinan, the association’s president, saying: “The cash burn arising from Covid-19 is unsustainable and is a threat to the viability of many SMEs [small and medium enterprises], including farmers.
The Credit Guarantee Scheme will help to address working capital needs in order to protect upstream and downstream employment, as well as the productive capacity of the agri-sector.
Cullinan noted: “Interest rates, while not decided yet, will be less than the current market rates. However, the price of the loan must reflect the cost of the state guarantee.”
Meanwhile, Rose Mary McDonagh, the IFA’s farm business chairperson, commented: “The inclusion of primary agriculture, horticulture and aquaculture in the scheme is a welcome development, as it will address the accelerated and growing demand for cash-flow arising on many farms as a result of Covid-19.”
McDonagh added: “Initially, funds can be used for term loans of up to six years. Overdraft facilities and working capital options need to be added immediately, not later in the year.
The operation of the scheme will be overseen by the Strategic Banking Corporation of Ireland [SBCI] and applications can be made directly through AIB, Bank of Ireland and Ulster Bank. The SBCI has launched an open call for the expression of interest among other lenders to participate in the scheme.
McDonagh noted that the closing date for applications is December 31 of this year.