SA Drought Loan Scheme
Earlier this week the SA Government announced a new SA Drought Loan Scheme, aimed at supporting drought-affected grain and livestock farmers in South Australia’s eastern and northern agricultural regions, including Murray Mallee, Riverland, and Upper North regions. These areas have been hit the hardest, experiencing record-low rainfall and severe dry conditions over the past 24 months.
This scheme will allow access for eligible participants to urgent financial assistance through the provision of low interest loans, and allowing for loans up to $250,000 with a loan term of 10 years, and a funding cap of $200 million. Recipients will not be required to make repayments for the first 2 years of the loan term, with interest throughout that time accrued, and added onto the principal. The loans are set for working capital only, and cannot be used to refinance any existing debt.
Loans will have concessional interest rates for the first 2 years at the 50% of the Commonwealth 10-year bond rate (currently 2.41%). The remaining 8 years of the loan will be based on the 10-year Commonwealth bond rate (currently 4.83%)
Applications are set to open in March, and as it stands the loan scheme will be available until the end of the year, 31 December 2026. You can express your interest now via this form.
Image Source: PIR.SA.GOV.AUStay Informed
To keep up to date, register here to receive updates and any new information about the SA Drought Loan Scheme
Eligibility Criteria
From the official page, eligible participants primary production businesses must meet the following criteria:
- Be a grain or livestock producer operating in either the Murray Mallee, Riverland or Upper North regions. Eligible councils include: Karoonda East Murray, Mid Murray, Southern Mallee, Coorong, Murray Bridge, Renmark Paringa, Berri Barmera, Loxton Waikerie, Orroroo Carrieton, Peterborough, Northern Areas and Mt Remarkable
- Demonstrate your business is financially impacted by drought
- Operate as a sole trader, partnership, trust or private company within SA
- Be registered for tax purposes in Australia with an ABN and be registered for GST
- Not be under external administration or bankruptcy
- Have at least one member that has owned and operated the primary production business for at least the past three consecutive years and who, under normal circumstances, contributes the majority of their labour and derives the majority of their income from the primary production business
- Intend to continue carrying on the primary production business within the eligible regions
- Demonstrate that the primary production business has reasonable prospects of long-term viability with the assistance provided
- Use the funds for the approved purpose only (not to be used to refinance existing commercial loans)
- Demonstrate that the primary production business has the capacity to repay the loan
- As required, provide a registered mortgage over farming land that is sufficient to satisfactorily secure the loan
The full conditions of the terms of the loan are also on the official SA Government Drought Loan Scheme Page
Terms of the Loan
- The loans will assist farm businesses to fund day-to-day operational costs, including direct cropping and livestock costs and overhead costs that will assist with drought recovery
- It is not to be used to refinance existing debt
- The loans will have concessional interest rates for the first two years at 50% of the Commonwealth 10-year bond rate (CBR, currently 2.41%)
- The rate for the following 8 years will be based on the 10-year CBR (currently 4.83%)
Applications
If you are eligible, you can prepare the necessary documentation required to apply for this loan scheme. This includes:
- Past 3-year business and personal tax returns
- Financial statements
- Cashflow budgets
- Statement of financial position (assets and liabilities)
Contact Information
If you require any assistance or have further questions, you can call or email: