Farmers’ overdraft facilities must be maintained as they transition to a new bank following the closure of their Ulster Bank account, the Irish Farmers’ Association (IFA) has said.
Banks must be understanding of the fact that farmers are facing rapidly rising input and energy costs, and extend an operational line of credit to them, IFA Farm Business Chair Rose Mary McDonagh said.
Speaking at a small and medium enterprise (SME) roundtable event, she stated that farmers need their new bank to demonstrate a flexible and supportive approach as they try to navigate a change that has been imposed on them.
“Farmers will need to take steps to move to their new finance provider, and I would encourage them to do so sooner rather than later to avoid any unintended consequences.
“They will need clear direction and support to make the transition/switching process as seamless as possible too,” she said.
The event was hosted by the Banking and Payments Federation of Ireland, where the main financial institutions stated that following the announcement that Ulster Bank was to shut, they received unprecedented volumes of applications, which has led to a number of backlogs.
These backlogs have been particularly prevalent amongst business current accounts, where the number of authenticity requirements have delayed decisions.
Ulster Bank began issuing six-month notices in April of this year, informing customers that their current and deposit accounts would be frozen on or after November 11. It also informed them that 30 days after this date, their accounts would be shut completely.
25 of the bank’s branches are to close in January 2023 before re-opening shortly after as Permanent TSB.
The bank announced that it had acquired the branches as well as Ulster Bank’s residential mortgage business, which is worth €6.2 billion, earlier this month.
As a result of the acquisition, the bank will welcome about 56,000 new residential mortgage customers, which represents an increase of approximately 40%. It will also see 113 Ulster Bank employees join its ranks, split between Permanent TSB itself and its service partner Pepper Finance.