Farm Credit Canada (FCC) unveiled its new Starter Loan to help young borrowers involved in the agriculture sector access the financial capital and knowledge they need to start and grow their business.
The Starter Loan Program is open to applicants from 18-25 years of age, and can provide up to $50,000 to help new entrepreneurs start their farming operations. Loan funds can be used to finance the purchase of assets such as livestock, equipment, or an existing business and is available to both primary producers and agri-businesses.
Coupled with this, FCC is offering their farm management software, AgExpert Accounting Premium, for free, with the intent that young borrowers can have the financial independence and knowledge they need while establishing a solid credit history.
“Farm operations are a generational business, often passed down through families with succession plans for children that want to follow in their parent’s footsteps,” said Ron Bonnett, president of The Canadian Federation of Agriculture, in response to the announcement. “But not all aspiring farmers have that kind of support or knowledge to draw from. Starting a farming operation has huge capital costs and an intense burden of knowledge. The FCC Starter Loan program can help new, young farmers break into the sector. Programs like these are pivotal for the next generation of farmers and the future of Canadian food production.”
“The FCC Starter Loan shows our commitment to supporting our customers throughout their lifetime. A young borrower may have the goal of starting a cattle herd or purchasing some quota. Another may take their entrepreneurial vision to the next level with a vertical farming system or decide to purchase their first piece of equipment. It’s a start to a lifetime of possibilities,” said Micheal Hoffort, FCC president.
In 2018, the Bank of Montreal (BMO) launched its own loan program for Canadian farmers 35 years of age or younger. The BMO Young Farmer Program provides higher advance rates to invest in equipment, new technologies or the overall infrastructure of a farm operation.