Drought loans for farm businesses

Overview

Drought Loans provide farm businesses with loans to help them prepare for, manage through and recover from drought.

The loans may be used to:

• feed and water stock
• refinance existing debt
• pay for operating expenses or capital
• enhance productivity
• fund drought-related activities

Loans of up to $2 million over a period of 10 years are available. The first 5 years will be interest only, followed by 5 years principal and interest. After 10 years, any remaining balance on the loan can be refinanced with a commercial lender.

Check if you can apply

To be eligible, you must:

• be an Australian citizen or permanent resident
• contribute or plan to contribute at least 75% of your labour to the farm business (under normal circumstances)
• earn or plan to earn at least 50% of your income from the farm business (under normal circumstances)
• own or lease land and use it for farming purposes (includes agistment)
• have a drought management plan
• provide security for the loan
• secure the support of your commercial lender for the proposed loan
• repay the loan.

Additionally, your farm business must:

• be in financial need of a loan
• have the capacity to repay the loan
• be financially viable in the long term
• have existing commercial debt
• be in the agriculture, horticulture, pastoral, beekeeping (apiculture), or aquaculture industry
• undertake all primary production aspects of the business wholly within Australia
• be registered for tax purposes in Australia with an Australian business number (ABN) and be registered for goods and services tax (GST)
• operate as a sole trader, trust, partnership or private company
• not be under external administration or bankruptcy.