ICMSA welcome new loan scheme option for farmers
Noting an interest rate of 3.75% on loans up to €250,000, the Chairperson of ICMSA’s Farm Business Committee, Shane O’Loughlin, said that farmers looking for funding for their farm business should consider the Covid-19 Loan Scheme (‘CLS’) announced yesterday by Ministers Varadkar, Donohoe and McConalogue. Loans of between €25,000 and €1.5 million are available with up to €500,000 available on an unsecured basis and Mr. O’Loughlin said that very significant numbers of farmers are in the market for funding for liquidity and investment purposes.
“The interest rate available under this loan scheme is particularly attractive at present and applications will be considered for working capital, investment and also an element of restructuring. ICMSA thinks that farmers currently considering funding options should seriously look at this with details available www.sbci.gov.ie. “, said Mr. O’Loughlin.
On the broader question of competitive farm financing, Mr. O’Loughlin said that the announcement is welcome and is itself a tacit recognition by the Government that the farm finance options being offered by commercial lenders were overly expensive and this loan scheme will certainly set a benchmark for farmers and other SMEs.
“It’s noteworthy that the official announcement makes reference to the fact that the finance available on these loans is ‘competitively priced’ – and it very definitely is by comparison with what our commercial lenders are quoting Irish farmers. The much bigger question which ICMSA has raised repeatedly with everyone from the Central Bank downwards is why ‘competitively priced’ farm finance is only available through these special state-backed arrangements? Why are commercial banks and lenders in Ireland offering farm loans and finance so much more expensive than their continental counterparts? We’ve asked this for a decade and have never received a meaningful answer. The Government is aware of this surcharge because their own financing makes direct reference to the fact that it is ‘competitively priced’ by comparison with our banks. Maybe the Government could ask the banks why they charge so much by comparison to continental banks?”, said Mr. O’Loughlin.
Ends 7 July 2022
Shane O’Loughlin, 086-8386031
Chairperson, ICMSA Farm Business Committee
Cathal MacCarthy, 087-6168758
ICMSA Press Office
+353 (0)61 314677
ICMSA Head Office
John Feely House