If you’re struggling to keep on top of your agribusiness finances, you’re not alone.
Your bank has experienced agribusiness specialists ready to help.
It’s important to be as open and realistic as possible about your financial position.
The sooner you get in touch, the sooner you can find help.
An accountant, business advisor or a Rural Financial Counsellor (1300 771 741) could help you with simple tools to manage your budget and help provide a better understanding of your situation.
The sooner you get in touch, the sooner you can find help.
What if I think I can’t afford repayments on my loan?
Your bank is ready to listen and help. Don’t be afraid to contact them as soon as possible. The sooner you do, the sooner they can help you find a solution that is right for you.
It’s also a good idea to consider what changes you can make:
- Review your budget and business plan
- Consider any expenses you can reduce
- Speak to a rural financial counsellor – The earlier they get involved the faster your options can be reviewed.
- Seek independent advice from an accountant or business adviser about restructuring your business
- You may qualify for the Australian Government’s Farm Household Allowance which provides income support and other ancillary benefits.
- Farm Hub connects Australian farmers to a range of helpful services and support.
You may also qualify for a concessional loan from the Regional Investment Corporation or state-based regional assistance grants or loans. Rural Financial Counselling (1300 771 741) can help navigate what’s available.
It’s a good idea to properly understand your business’ true financial position and have this information with you when you speak to your bank.
What are some of my options?
Your bank will work on a case-by-case basis with you to consider possible solutions if your finances have been hit by drought, natural disasters or other recent events beyond your control.
Depending on your circumstances and your bank, there may be a number of options your bank could offer to help your business through these difficult times. These include:
- Waiving fees and charges, including break costs on early redemption of Farm Management Deposits
- Debt consolidation to help make repayments more manageable
- Offering additional temporary finance to help cover short-term cash flow shortages such as overdraft
- If your annual turnover is less than $50 million, you may be eligible for a loan under the Government’s Coronavirus SME Guarantee Scheme (check with your bank to see if they are participating in the scheme).
- Talk to your bank about options to reduce repayments or to restructure your loan
- A deferral of scheduled principal loan repayments.
You should also check any of these options against your budget to ensure they deliver the best outcome.
Your bank may also ask for relevant information depending on the circumstances. For example, an updated statement of position or a valuation may be required, so they can better understand how they may be able to help with the potential options available.
If your bank doesn’t allow you to change the terms of your loan, they need to tell you why in writing.
What interest will I pay due to a deferral?
In most deferral arrangements the interest and any principal repayments you’d have normally paid during the deferral period will continue to accrue. This will be added to your outstanding loan balance to be paid once the deferred period ends.
This can be paid by either extending the term of the loan, increasing repayments, or a combination of both. Your bank should contact you with options towards the end of your deferral period.
When your bank set up the deferral, you will have received details of the arrangement in writing. You should check what your bank told you would happen when the deferral ends.
Take care of yourself and seek help with your decisions
Please reach out if you are feeling stressed about your financial situation. Rural Financial Counselling services (1300 771 741) can provide you with free, confidential planning and support to help make better informed financial decisions for you and your business.
