Banks need to build “personal relationships” with farmers to allow them access cash faster, according to the president of the Irish Creamery and Milk Suppliers Association (ICMSA), Denis Drennan.
Personal relationships between farmers and banks are needed in the current crisis to make cash available for farmers to “get through this horrific period of weather”, he added.
Speaking to Agriland, he stressed the importance of farmers not having to go through lengthy processes to access cash, and described the current banking system as “broken” and as one without a personal relationship.
Amid the persistent wet weather conditions which have led to fodder shortages on some farms, Drennan said that “mentally, physically and financially, people are at breaking point”.
Speaking to Agriland, he said: “What we really need is that we get back to the old days where you knew somebody in the bank and they knew you.
“If you’re in difficulty, you could pick up the phone ring Johnny or ring Mary and say, ‘look, I’m in a bit of a pickle at the moment, the weather is atrocious, I need to go buy silage’.
“I need €2,000, €3,000, €5,000, €8,000, and you could get a decision straight away and that money was in your account the following day.
“But now if you want to get a a loan in an emergency situation, you’re looking at ringing a helpline. You’ll be guaranteed a call back within two to three days, and then you’re gonna have to go present three years’ set of accounts,” he said.
ICMSA
Drennan said that cashflow is “very tight” on farms at the moment, and that there is now a situation where people are not allowing fodder to move out of their yard, if it is for sale, unless money is either transferred or they turn up with cash.
The association has met with one of the main banks and is currently in the process of meeting with a second one of the main banks this week to discuss the situation, Drennan said.
He believes there needs to be a situation where the business manager knows the farmer, and vice versa, the type of person they are, the type of farming they are in, and how they do business.
“That’s what people are looking for. It’s not this dial up a call centre and press one for this, press two for that, press three for the other and you meet somebody who has no idea.
“There needs to be a relationship there that people know you and you know them, and [that there is] trust built up like there was years ago. That’s what’s badly needed,” he said.
Bank of Ireland
Meanwhile, Bank of Ireland (BOI) has urged farmers who have concerns as the wet weather persists to engage as soon as possible with the bank to explore financing options available.
BOI agri-development manager, Mark Glennon said they understand that this is a particularly challenging time for farmers, and that flexibility is required when engaging with a financial provider.
“I would encourage any farmer seeking assistance to talk to us, so that we can ensure your finances are properly structured and devise a plan that will help overcome the current challenges.
“The rain will stop falling eventually, and with the right financial plans in place we can ensure that agri-businesses nationwide can look forward to brighter days ahead,” Glennon said.
Recently AIB has also urged farmers to contact their local branch for cashflow support as wet weather and storms cause difficulties on farms.