Farm Ireland

Tuesday 24 April 2018

Fianna Fail doesn't want banks involved in new low-cost farmer loan fund

Fianna Fail spokesman on Agriculture Charlie McConalogue
Fianna Fail spokesman on Agriculture Charlie McConalogue

Fianna Fail has voiced its opposition to the involvement of the pillar banks in the Government’s new low-cost agri loan scheme.

Under the new scheme, the Strategic Banking Corporation of Ireland will put out a call for partners to deliver the scheme. The Minister for Agriculture Michael Creed has said that he has spoken to Bank of Ireland, AIB, and Ulster Bank to date.

However, Fianna Fail Agriculture Spokesperson, Charlie McConalogue has been critical of the Minster's handling of the scheme to date.

In a recent Dail debate he said there is a real dearth of detail on the start date and the criteria that will be in place for farmers who apply.

“I note the extent of the income pressure on farmers in the past week. We see it in beef and tillage at the moment and have seen it in the past year in the dairy sector and the mushroom sector.

“The Minister said early 2017. We will hold the Minister to the early January 2017 date.

“It is much too late, however, because action is needed now. There is a real crisis in incomes across the farming sector and the support is not there for it as we speak.

McConalogue also said that the Minister has also failed to provide detail today on the exact criteria to be met in order to apply for these loans. Will people be able to refinance existing loans?

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“Will it specifically target merchant credit, which is due now, not next January? How are those farmers going to fare?

“Many tillage farmers were not able to salvage their crops or harvested crops which were not worth salvaging," he said.


McConalogue has said that it will be Fianna Fáil's position that the Strategic Banking Corporation of Ireland should, instead, be licensed to provide funding directly to farmers and small businesses, in cases where they apply for separate funds.

He says the interest rates that banks have been charging farmers have been 'out of kilter' with those in other parts of the EU. He says if the SBCI were to operate the fund independently of the banks to would pressurise the lenders to reduce there current rates.

However, Minister Creed rejected this proposal stating that the SPCI does not have the necessary network to deliver the loan product.

“It operates out of an office in Dublin and does not have a branch network.

“Those in Letterkenny, west Kerry or west Cork who want to access the loan product need access through a local financial institution.

“The SBCI will put out a call for partners to deliver the scheme. I have spoken to Bank of Ireland, AIB, and Ulster Bank. It is open to others.

“I was recently asked whether the scheme is open to credit unions - I suspect it is, if they can demonstrate a capacity to deliver the product in a manner that is acceptable to the SPCI.

“We want these institutions to be involved because they have the required network and existing exposure to and understand of the agricultural lending sector,” he said.

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