Regional Investment Corporation (RIC) Loans

Regional Investment Corporation (RIC) Loans

RIC loans are available to primary producers and small businesses (who provide goods or services to primary producers) for recovery from drought or floods or for farm investment.

The loans are offered at a concessional rate (it is variable but has been as low as 2.11%) and interest free periods for the first few years of the loan. There are three types of RIC loans that can be applied by primary producers and one for small businesses that supply to primary producers:

  • Drought Loan – to assist your farm businesses through drought, with loans of up to $2 million with a 10 year term and a 2.11 variable interest rate, the first two years are interest free with no repayments required
  • Farm Investment Loan – to assist your farm business invest in in projects and infrastructure that will strengthen your business, with loans of up to o $2 million with a 10 year term and a 2.11 variable interest rate, the first five years repayments are interest only
  • AgRebuild Loan – to assist flood-affected QLD farmers, with loans of up to $2 million with a 10 year term and a concessional
  • AgBiz Drought Loan – to assist your small business (not primary production) through drought, with loans of up to $500,000 with a 10 year term and a 2.11 variable interest rate, the first two years are interest free with no repayments requiredinterest rate, the first three years repayments are interest only
Recent changes to the Drought Loan

Recent changes to the Drought Loan

As part of the Federal Government’s Drought Stimulus package, RIC has announced recent changes to their Drought Loan including:
• a 2 year interest free period;
• 3 years interest only at 3.11% variable;
• 5 years principal and interest
• total 10 year term, no fee on early settlement

If you are using the Drought Loan to refinance, at least 50% of your total debt has to stay with a commercial lender.

Is a RIC Loan worth applying for?

It depends on your circumstances but if for example you were looking at loan that allowed you to refinance 50% of your commercial debt (eg: Drought Loan) on a pure interest saving perspective you could be saving tens of thousands of dollars per year.

For example, if you refinanced part of your existing loan for say $1,000,000 and you were currently paying say 4.5% interest, then the saving would be $45,000 per year over 2 years or $90,000. Followed by a low variable interest rate (currently 3.11%) for 3 years, a further saving of $13,900 per year (based on the comparative rate between 4.5% and 3.11%) for 3 years or a further saving of $41,700. Total savings over 5 years of $131,700. You could either re-finance at the 5 year mark or commit to repaying the loan from that point onwards.

If the RIC loan is for working capital to plant crops or re-stock the benefit is really in the capacity of the business to continue to operate.

How do I get started?

The application process for a RIC loan application can be completed either by hand or by computer to fill in the electronic PDF. The 16-page application form asks for extensive details about your farm business
and any associated individuals (partners, company directors, trustees). In addition to this you also need to provide documentation including:
• a drought management plan
• Australian Business Number (ABN)
• financial history
• identity documents
• proof of your eligibility
• your business cash flow budget

The process of applying for the RIC loan can be quite a daunting task and may consume many hours that primary producers just don’t have at their disposal. This is where Agri-Analytics can assist. Click here to begin our quick online application form.

How can Agri-Analytics assist?

As a specialist Ag data management company, Agri-Analytics are uniquely placed to assist primary producers work their way through the RIC Loan Application. Click here to learn more about our history.

Agri-Analytics can assist farm business through the RIC application process with facilitating the data collection, liaising with RIC, working with you to ensure your applicant meets all requirements before submission. By working beside the farm business we can provide the support the need and ensure that RIC are supplied with the information they need in the form they want. In short, we will make this process seamless and as quick as you want it to be.

Agri-Analytics Support

Agri-Analytics will take the application that appears infinite and break it down into workable parts. Beginning with a simple online form that asks for farmer contact details and farming entity information. This is enough
to get Agri-Analytics started on the application. From there we will communicate with the farm business to supply the additional information needed, working in sections rather than one large overwhelming document.
For the sections of the RIC Loan Application that can seem complex, such as the Drought Management Plan or cash flow budget, we provide templates or can work with dot points from the farmer to draft a working document.

We support farmers throughout the process through phone, email and SMS, to the level that suits them best. Some farmers are looking for a quick and simplified process, while others will need ongoing guidance and support through a process that can seem insurmountable. For farmers who are not tech savvy we can help them complete the form over the phone.

Security & Privacy

Given the confidential nature of the data and documents we collect from farmers, security and privacy are part of the DNA of Agri-Analytics. We collect data through a secure online platform, supported by Amazon Web Services. All data and documents we collect are accessible only to authorised staff and securely stored in our cloud content management service. Agri-Analytics have a detailed Privacy Policy that can be viewed here.

Costs

Agri-Analytics charge a $2,000 (exc GST) flat fee upfront to complete the application. If the farm business is notified by RIC that their application has been unsuccessful, Agri-Analytics will refund the fee.

Contact Us

Call or email our Customer Service Manager, Lizzy Squire, on 07 3212 2503 if you have any questions or would like more information.

Supporting Documentation for Partnerships & Trusts

If the farm business applying for a RIC loan is a Partnership or Trust you will need to provide originals or certified copies of supporting documentation as listed below.

What type of documents?

For Partnerships (one of the following):
a partnership agreement; or
the partnership tax return; or
the minutes of a meeting of the partnership
For Trusts:
a full trust deed and any amending supplementary deed (executed and dated); and
the full name of the settlor of the trust (only if the asset contribution at establishment is $10,000 or more)

Certified Copy

Evidence of Australian citizenship or permanent residency needs to be a copy of the relevant documentation that has been certified as true and correct by an Acceptable Referee:

Cash Flow Budget

As part of your RIC loan application you will need to provide copies of your actual and projected budget cash flows.  To guide you as to what information RIC will need they have provide a downloadable template on their webiste.  Click here to download the template.

Actual Cash Flows – Current Financial Year

Your financial year-to-date actual results and a cash flow budget projection for the remainder of the current financial year.

Projected Cash Flows – Next Financial Year

Your cash flow budget projection for the next financial year.  If, as part of your application, you are forecasting a ‘significant financial impact’ over a 2 year period, you will need to include a budget for the applicable period.

Identification Requirements

As part of your RIC loan application you will need to be able to provide documentary evidence (proof) of the identity of all the individuals associated with your farm business. This includes:

Verifying your identity

The acceptable identification must contain the individuals full name and either residential address or date of birth.  The acceptable identification documents comprise:

Certified Copy

A certified copy of identification is one that has been certified as true and correct by an Acceptable Referee:

Citizenship / Permanent Residency Requirement

At least one member of the farm business applying for a RIC loan must be an Australian citizen or have Australian Permanent Residency.

As part of your RIC loan application, you will need to provide evidence (proof) of Australian citizenship or permanent residency for that member of your farm business. We will ask you to upload copies of the certified documents to our secure form.

What type of documents?

Certified Copy

Evidence of Australian citizenship or permanent residency needs to be a copy of the relevant documentation that has been certified as true and correct by an Acceptable Referee:

A Season Update client is a farming entity that has previously had Latevo Farm Income Protection and has completed a Latevo Income Assessment.

If you are unsure if you are a Season Update client please contact Latevo or your broker for assistance.

A New Client is a farming entity that has not previously taken out Latevo Farm Income Protection or has never had a Latevo Income Assessement.

If you are unsure if you are have ever had a Latevo Income Assessment please contact Latevo or your broker for assistance.

Please ensure the cashbooks files are a detailed general ledger (transaction) by category report preferably in pdf format from your accounting software.  There should be an individual file for each financial year.

Do not provide summary files, we are specifically looking at your grain sales transactions and a summary file will not provide this detail.

If you would prefer not to provide your full cashbooks please ensure you provide your detailed grain transactions and any associated transactions such as share farming.