Australian farmers have another six months of certainty in servicing loans with the Regional Investment Corporation (RIC) leaving its concessional farm business loan rate unchanged.
A statement from RIC, the Federal Government farm business lender, said the current 5.18 percent would remain in effect form February 1, for 6 months until the next review.
RIC Chief Executive Officer John Howard said RIC’s low interest rates continued to provide a concessional benefit to farm businesses in financial need.
“RIC concessional interest rates will stay the same … providing much-needed breathing space, greater certainty to manage cash flow, and stability to strengthen long-term financial position,” Mr Howard said.
He said RIC interest rates were only reviewed twice a year, bringing some certainty to RIC customers in planning their financial forecasts.
“One of the key benefits of RIC loans is interest rates are only reviewed every six months and are based on the average of the Australian Government 10-year bond rate, not Reserve Bank of Australia cash rate movements.
“Farm businesses with a concessional RIC loan also benefit from no application fees, no ongoing management fees, and no penalty fees for extra or early repayment.”
Mr Howard said RIC loans had a 10-year term with interest-only repayments for the first five years, followed by principal and interest repayments for the remainder of the loan term.
He said farm businesses could borrow up to $2 million, with farm-related small businesses able to borrow up to half a million dollars.
