Banks invited to take part in the new agri loan scheme
The Strategic Banking Corporation of Ireland (SBCI) has today invited banks and other lenders to take part in the new loan scheme that will make €150m available to farmers at low-cost interest rates of 2.95pc.
The Minister for Agriculture, Food and the Marine, Michael Creed, has welcomed what he described as an important step in the establishment of the “Agri Cashflow Support Loan Scheme”.
Recently, AIB confirmed to FarmIreland.ie that it has been engaging with the Department of Agriculture, Food and the Marine and the SBCI in relation to the Low-Cost loan announced in the Budget recently however, it did not confirm its participation.
Meanwhile, Bank of Ireland has said while the bank does not comment on engagement with Government, it will ensure that Bank of Ireland's existing and potential farming and agri customers are able to access any Government supported financial packages being made available as it has been doing with other government supported schemes.
This scheme will enable farmers to improve the management of their cashflow and reduce the cost of their short-term borrowings.
The scheme is being developed by the Department of Agriculture, Food and the Marine in partnership with the Strategic Banking Corporation of Ireland (SBCI).
Public funding of €25m from the Department, which includes €11m made available under the EU’s exceptional adjustment aid for milk and other livestock farmers and €14m in national funding, provides leverage for the €150 million scheme.
“Three pillar strategy”
Minister Creed said, since taking up office, one of his priorities has been to address the impact on farmers of the sustained period of lower commodity prices. He said he is conscious that this has caused cashflow difficulties for farmers in several sectors.
“This loan scheme forms part of a “three pillar strategy” in response to income volatility, which I announced as part of the recent Budget.
"Along with tax measures and farm payments, it will alleviate some of the pressures being caused by the current market difficulties including currency fluctuation in the aftermath of the Brexit referendum”.
The Minister concluded, “2016 has been a challenging year for farmers. As well as income volatility, there is a lot of uncertainty regarding the potential impact of Brexit on the Irish agri-food sector. In this context the scheme will enable farmers to improve their working capital position and provide longer-term financial stability”.
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