CORK, Ireland–Four credit unions here have partnered to pilot a loan program specifically tailored to the local farming community.
Called “Cultivate,” the program is being tested by the Mallow, Mitchelstown, Synergy (Fermoy) and Youghal credit unions, and is modelled on a similar project that has been operating in Galway, Ireland for the past year. The program has made €7 million in loans to farmers in Galway and Clare over the past 12-months.
Ciara Fitzgerald, marketing and business development officer with Mallow Credit Union, said the group of credit unions in Cork had identified farming as a particularly important sector to the economy and, with that in mind, had put together a definitive package of loans for farmers.
"In addition to generating income inside the farm gate, farming is also very much in the lifeblood of the rural community, with each euro earned by farmers having a multiplier effect in the rural economy," said Fitzgerald.
The four Cork credit unions have been collaborating on the scheme, which was launched by Corrin Marts complex in Fermoy by Martin Stapleton, chair of the IFA Business Committee.
Invaluable Feedback
"The feedback from this consultation and detailed market research has been invaluable in identifying the real needs of farmers,” Fitzgerald told local media. “They value the face to face relationship banking and the personal touch of credit unions, where a farmer can come in and discuss his or her proposal. They value a speedy loan application process and the fact that no security may be required for the loan. Competitive interest rates are obviously important due to the nature of cash flow on a farm and flexible repayment options are also a key factor in the success of the Cultivate product."
The program offers loans up to €50,000 for a variety of purpose, including livestock purchase, farm development and buying farm machinery purchase.
Start-up finance for young trained entrants to farming will also feature in the loan package, with the terms of loans up to seven years, according to the credit unions.
In order to better understand the market, loan officers from the four credit unions have been participating in an intensive Farm and Finance Training course organized by Teagasc and Pallaskenry Agricultural College.