South Australian farmers affected by drought may qualify for low interest drought loans to help ease financial pressure or fund new investment.
Accounting and advisory firm William Buck is working with agricultural and rural businesses seeking to access available external funding.
“Many farmers are doing it tough right now and facing significant balance sheet pressure,” William Buck’s Head of Agribusiness Ben Trengove said.
“Managing cashflow, accessing new debt and refinancing can be difficult for any business facing these extreme conditions. There are valuable initiatives that can provide some financial relief of which many farm owners or operators may be unaware. In the current drought conditions, every bit of assistance counts.”
The Regional Investment Corporation (RIC) is making low interest, no fee loans available for drought affected farmers in need of financial help. The RIC is a corporate Commonwealth entity established to encourage growth, investment and resilience in Australia’s regional communities. It currently has a $2 billion pool of funding available for eligible applicants.
The key points of the RIC drought loans are:
- Up to $2 million available
- RIC will lend up to 50% of total term facilities
- 10 year term (2 years interest free, 3 years interest only, 5 years principal and interest). Current rate 2.11%
- Used to refinance debt, pay (or access new debt) for operating expenses or capital
- Applicants must be farm business owners and have a drought management plan
- Future cash flow information required to prove long-term viability
“Some irrigators and livestock farmers who may not be directly impacted by drought but still feeling its indirect effects, for example through higher water and feed prices, may instead be eligible for a farm investment loan with RIC,” Mr Trengove said.
“A farm investment loan has similar conditions to the drought loan but with a 5 year interest only plus 5 year principal and interest payment structure.”
William Buck has a 70-year history of assisting South Australian agricultural and rural businesses. Its experienced team of advisors can provide further information about RIC funding and assistance throughout the application process. Call 08-8409 4333.
