Banks must give farm business customers more options, says IFA

FARM business customers must have more options for accessing and restructuring credit than are available.

That’s the view of the Irish Farmers Association, which has concluded a series of regional meetings with the sector and the Department of Enterprise, Trade and Innovation.

IFA deputy president Eddie Downey said there has been a significant reduction in the level of competition in Irish banking due to the difficulties in the sector.

“The Government must ensure, through its intervention in the domestic banking market, there are options to access credit, whether through their existing bank or by moving their business between banks,” he said.

Mr Downey said farm businesses have continued to invest and pay back their borrowings during the downturn.

“While there is a recovery in prices for some sectors in 2010, it remains vital the banks continue to restructure loans, as many farm businesses continue to experience cash flow pressures due to continuing price volatility.

“The banks must be prepared to extend new lines of credit for businesses that are looking to expand,” he said.

Mr Downey said the cost of credit has increased for banks and customers. The banks must offer the most competitive rates to farm and other small businesses and not exploit good customers through subsidising other loss-making divisions.

“Banks must improve their communication with customers and increase the level of expertise for loan applications,” he said.