Low-cost loans to become available this week
Low-cost loans will be available this week through AIB, Bank of Ireland and Ulster Bank, the Strategic Banking Corporation of Ireland (SBCI) has today confirmed.
A total of €150m will be made available to farmers throughout Ireland at a low-cost interest rate of 2.95% under the loan scheme, known as the Agri Cashflow Support Loan Scheme.
The loan scheme was announced in the Government’s 2017 Budget and is being developed in conjunction with the Department of Agriculture, Food and the Marine. It aims to support farmers experiencing short-term financial pressure due to price and income volatility.
The loans will enable farmers to plan and budget more effectively by providing an attractive alternative to more expensive forms of credit such as merchant credit and bank overdraft facilities, according to the SBCI.
SBCI CEO Nick Ashmore said that these loans represent SBCI’s first application of its newly secured COSME guarantee for risk sharing, with further risk sharing products in the pipeline for 2017.
The Minister for Agriculture Food and the Marine, Michael Creed said that the SBCI has demonstrated its commitment to the agriculture sector and has worked with his Department to get this product to the market in a timely manner.
“I welcome the participation of the main banks, which will ensure nation-wide coverage for the scheme. The fact that most farmers will have an existing relationship with the participating banks should facilitate the loan application process.”
One of my priorities is to address the impact of the change in the Sterling exchange rate and lower commodity prices in some sectors which have caused cash flow difficulties for farmers.
“This innovative loan scheme will provide farmers with a low cost, flexible source of working capital.
“This will allow them to pay down more expensive forms of short-term debt, such as merchant credit or overdrafts, contributing to the ongoing financial sustainability of their farming enterprises.”
- Loans of up to a maximum of €150,000.
- Loan term of up to six years.
- Loans are unsecured.
- Optional interest-only repayments provided at the start of the loan.
- Interest rate of 2.95% for the term of the loan.
Loans can be used for working capital requirements, as a more sustainable alternative to short-term credit facilities and as an alternative to merchant credit.
Further detail on this Scheme will be available on the SBCI website and on participating institutions’ websites.