The AgriStarter loan applications open to support the next generation of farmers. The loan encourages new entrants to farming and can assist with succession arrangements. Up to $2 million can be borrowed over 10 years with the first five years interest only, followed by five years’ principal and interest repayments.
The Australian Government has provided an additional $75 million in 2020-21 for the Regional Investment Corporation (RIC) AgriStarter Loan program to assist new entrants to farming looking to purchase, establish or develop their first farm business, and support farming succession arrangements.
“Individual loans of up to $2 million could be used for range of purposes including purchasing a fam business and other farm business assets as well as putting it toward costs associated with the succession planning process,’ Minister for Agriculture, Drought and Emergency Management, David Littleproud said.
“The Australian Government understands the importance of encouraging a new generation of farmers to the sector and the AgriStarter Loan program will support this The loan also means that families will be able to discuss succession arrangements and plan for the future,” Minister David said.
“The additional funding available this financial year would ensure support was available where it was needed most,” Minister for Finance Simon Birmingham said.
“The AgriStarter loan program has been an important initiative to help farmers and small businesses get through the hard times, while also supporting new farming enterprises to get off the ground. This is about backing Australia’s next generation of farmers to grow and prosper which also has flow-on effects throughout regional economies and creates more regional jobs.,” Minister Simon said.
The RIC’s current variable concessional interest rate is a record low at 1.92 per cent. The initial loan term would be ten years, with interest-only repayments for the first five years and principal and interest repayments for the final five years.
New entrants, farm businesses or successors can use the AgriStarter loan for relevant purposes including funding the purchase, establishment or development of a person’s first farm business, paying costs associated with the succession planning process, or buying out relatives during farm business succession.
In addition to meeting the RIC’s eligibility requirements, AgriStarter loan applicants will need to hold or obtain a loan on commercial terms, demonstrate relevant experience, provide sufficient security for the loan and be in need of a concessional loan.