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