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Frequently asked questions (FAQs)
Our loans
There are key eligibility criteria for each RIC loan. Take our eligibility quick quiz and explore our education toolkit to learn about the requirements of RIC loans.
A business that derives the majority of its income from primary production within the agricultural, horticultural, pastoral, apicultural or aquacultural industries.
Read our explainer article on eligible industries.
Unlike government grants, RIC loans need to be paid back. Responsible lending and eligibility criteria apply, including assessment of the ability to make repayments and meet interest commitments.
We are proud to work alongside the Australian agricultural sector and the financial services industry, but we are not a bank. RIC provides loans, not overdraft, savings or transactional accounts. The Australian Government does not make a profit from RIC loans. RIC offers low-interest, long-term loans with no account keeping fees and no penalty fees for early repayment.
Applicants should discuss their intention to apply for a RIC loan with their bank or commercial lender prior to application. Ideally, the bank should provide support or agreement for the RIC loan prior to applying. RIC will then work with the bank directly to manage through any details of refinancing and other financial requirements.
Loans are expected to have sufficient security within standard lending practices. Security will be assessed on a case-by-case basis. It can include a registered mortgage over land, a registered security interest in water rights, or in some cases, a registered mortgage over livestock.
YIYO is a form of cash flow projection or summary of your farm business’ performance. it projects the expected cash flow from operations in normal conditions and includes yields, prices, costs for each season of farming as well as your long-term averages. It can be as simple as an excel spreadsheet or you can use agricultural-specific software programs.
The YIYO cash flow projection will be important in our credit assessment. This should reflect the operation once it has developed to full productive capacity. We will require at least two years of projected cash flows. Applicants are encouraged to supply all assumptions, including cropping plans or stock schedules to support the transition to achieving the YIYO cash flow. For applicants undertaking the establishment of tree crop enterprises, cash flows should reflect the emerging productive capacity of their trees and the YIYO cash flow will need to demonstrate the viability of the enterprise within the 10-year term of the loan.
Commercial debt is debt that has been established upon commercial interest rates, terms and conditions. This may include financial institutions and other providers where formalised loan contract is in place. The contract would typically include commercial interest rate, repayment schedule, loan term, security arrangements and mortgage documentation.
Read our explainer article for more information.
If you can show in your YIYO forecast that your business has sufficient cash to meet interest payment, operating expenses, living expenses, principal repayments, and any capital reinvestment to keep the business operating, you may be deemed as viable.
Yes, if the accommodation is used for workers that directly support primary production. This would not be the case if the accommodation was to be used as a 'farm stay' tourism accommodation.
AgriStarter Loan
AgriStarter Loan applicants are expected to have built up equity prior to applying. Addressing security requirements may be assisted through the applicant’s cash contribution to their purchase or security over net equity in off-farm assets e.g. residence or investment properties offered as security.
Relevant on-farm experience means that you or a member of your farm business having previously owned the business for 3 years or more. Equivalent experience is assessed on a case-by-case basis and can include working on the family farm, managing another farm business, Agribusiness qualifications, experience working closely with the manager of a farm business, or other complementary qualifications or experience.
Read our explainer article for more information.
Succession planning is the development of a plan that allows the smooth transition of the management of a farm and the farm assets from the one generation to the next.
Farm Investment Loan
A negative impact to your business that is outside of your control and has (or is forecast to) significantly reduce the profitability, cashflow, or financial resilience of your farm business. An example could be forced destocking through forced sales and movement of stock to agistment or feedlots due to on farm feed depletion caused by drought, disease, or natural disaster.
RIC will also take into consideration the financial need following on from the direct financial impact, meaning what you have needed to do or what you have been unable to do as a result of the direct financial impact.
Read our explainer article for more information.
Multiple events that follow one another. This could include drought conditions followed by an unexpected market closure. The first event should have occurred within the last 5 years.
Drought Loan
A negative impact to your business that is outside of your control and has (or is forecast to) significantly reduce the profitability, cashflow, or financial resilience of your farm business. An example could be forced destocking through forced sales and movement of stock to agistment or feedlots due to on farm feed depletion caused by drought, disease, or natural disaster.
RIC will also take into consideration the financial need following on from the direct financial impact, meaning what you have needed to do or what you have been unable to do as a result of the direct financial impact.
Read our explainer article for more information.
A Drought Management Plan is a simple document that outlines activities and practices your farm business undertakes or will undertake to prepare for, manage through, or recover from drought conditions.
Use our template here.
Manage your loan
No. You can only pay off interest once it has been charged to the loan.
You will need to request a variation to your loan agreement.