The Morrison Government is providing continued assistance to farmers and small businesses by providing an additional $2 billion in loan funding to the Regional Investment Corporation (RIC) for 2020-21.
Finance Minister Mathias Cormann announced the additional funding doubles the total farm and small business loan funds to $4 billion to meet demand for the RIC’s sought-after drought loan products.
“This funding is available this financial year to ensure support is provided where it is most needed and with the best possible impact,” Minister Cormann said.
“Parts of Australia have had good rainfall and the RIC’s drought loans can be used for recovery activities such as replanting and restocking”.
Member for Barker Tony Pasin said the Regional Investment Corporation’s loans had been a life line for many farm businesses allowing them to refinance or continue to invest and grow their business.
“The RIC is helping to strengthen farm businesses by providing them with access to low-cost finance so they can build and maintain diversity in the markets they supply, and take advantage of new and emerging opportunities across Australia and overseas,” Mr Pasin said.
The RIC will also be provided with additional operational funding of $50 million over four years to deliver the additional loan funding as well as process the significant volume of applications already on hand.
The additional loan funding comes with changes to loan terms, with the two-year interest free period not being available for the Drought Loan and AgBiz Drought Loan applications received after 30 September 2020.
For applications received after 30 September 2020, a five-year interest only period will apply, followed by principal and interest for the remainder of the 10-year term.
The interest rates for Farm and Small Business Loans will drop to 1.92% effective from 1 August 2020. These concessional terms will still enable rural businesses to save thousands of dollars a year on interest bills and put those savings to better use.
The RIC’s AgriStarter Loans, designed to support people in establishing a new farm business, buying an existing farm business or undertaking succession arrangements, will receive $75 million in 2020-21 and become available from 1 January 2021.
“The Government understands the importance of encouraging a new generation of farmers to the sector and the AgriStarter Loans will be a useful program to support this,” Mr Pasin said.
Businesses can get more information about RIC loans by visiting the RIC website or calling 1800 875 675.
Media contact: Charlotte Edmunds 8531 2466