Thursday, 5 March 2020
Department of Agriculture, Food and the Marine
Future Growth Loan Scheme
915. To ask the Minister for Agriculture, Food and the Marine the number of farmers in addition to food businesses who have applied to the future growth loan scheme which opened in March 2019; the number of farmers and such businesses that have been sanctioned financing to date; and the value of same in tabular form. [3905/20]
The Future Growth Loan Scheme was developed by my Department and the Department of Business, Enterprise and Innovation, in partnership with the Department of Finance and the Strategic Banking Corporation of Ireland (SBCI). It is being delivered through participating finance providers nationally to make up to €300 million of investment loans available to eligible Irish businesses, including farmers and the agri-food & seafood sectors.
The loans are competitively priced (an initial maximum loan interest rate of 4.5% for loans less than €250,000), are for terms of 8-10 years and support strategic long-term investment in a post-Brexit environment. A minimum loan amount of €100,000 applies up to a maximum of €3,000,000 per applicant. However, considering the needs of Irish farmers, I negotiated a specific minimum of €50,000 for them.
This is a financial product that was previously unavailable in Ireland, hence the involvement of the various public bodies to bring it to market. The unique characteristic of the Scheme is that loans up to €500,000 are unsecured, making it a viable source of finance for young and new entrant farmers, especially the cohort who do not have high levels of security. It also serves smaller-scale farmers, who often do not have the leverage to negotiate for more favourable terms with their banking institution.
Food companies have identified long-term investment finance of up to ten years as a critical need which is currently unavailable in Ireland. I am happy that the Government have been able to deliver this product and its effects will be felt all along the food production chain from primary producer to processor.
The Scheme has been open for loan eligibility applications through the SBCI website since 17th April 2019. At close of business on 28th February, 3,132 applications had been received, of which 3,001 are approved, 2 are ineligible and 129 are in progress. A breakdown, including details of farmers and agri-food businesses, is in the table.
Future Growth Loan Scheme at 28.02.2020
|Applied||Approved||Sanctioned||Value of Sanctioned Loans|
|No of Farmers||1,079||1,021||420||€51.6m|
|No. of Food Businesses||350||335||85||€24.3m|
The Scheme has been popular among businesses and farmers and there has been very strong demand for this longer term, lower cost finance. This demand has resulted in a rapid take-up of the Scheme and consequently SBCI have advised that there is limited remaining capacity.