Barnaby Joyce
May 16, 2016
The Rural Bank has announced it will offer customers the ability to offset farm loan interest using Farm Management Deposits (FMDs).
From July 1, the amount of money farmers can put into FMDs will double from $400,000 to $800,000 and farmers will once again be able to access their FMDs early during a drought.
The Federal Government has also removed a restriction preventing FMDs being used as loan offsets.
“Rural Bank is the first financial institution to announce it will offer farmers the ability to offset their farm loan interest by using FMDs. Rural Bank is sending a positive signal and I have no doubt other institutions will follow its lead,” Deputy Prime Minister Barnaby Joyce said.
“Put simply, FMDs allow farmers to put pre-tax income aside in good years to build up cash reserves for use in low income years.
“Having money set aside in an FMD to draw on in lean years can help farmers and farming families to bring their businesses back to profitability when conditions improve.
“The Coalition is now providing yet another reason why farmers should invest in FMDs by allowing them to be used to squeeze down interest accumulating on farm debt.
“I congratulate Rural Bank for its initiative and encourage more banks to follow their lead.”
