Bank launches $60m young farmer fund

The bank says it will offer unsecured loans of up to $50,000 in a bid to help what it describes as 'talented young people' into farm ownership. ANZ plans to spend $60 million over the next five years on the venture, which will also include a series of seminars and special coaching for those applying for loans under the scheme

The ANZ's managing director, commercial and agri, Graham Turley says the amount of capital required to buy a farm has now soared to over $1 million. He says there is "a lost generation" of New Zealanders turning their backs on agriculture with the average age of farmers increasing. It now stands at 50.

Turley says ANZ is relaxing its credit criteria to make loans of up to $50,000 without any security. He says quite often young people don't have any assets on which to secure a loan to get up on the first rung of the ladder to ownership.

"It's really hard for a young person working on a farm to try and get into a lower order share milk position or to lease some property. We're saying we can help you on an unsecured basis if you can demonstrate the skills that are required to get into farming and you don't have the financial backing. We are happy to back you to get on that first rung of the ladder and hopefully you'll be away laughing," he told Rural News.

However, the bank says it is not being reckless with this offer. Turley says it won't be available to anyone who walks into the bank and says they want to go farming.

"People will have to demonstrate, by way of a business case, about what they want to do and we'll help them with that by offering training on budgeting and business planning. This is a start up package which will help young people and speed up their entry into farm ownership," he says.

In terms of interest rates, Turley says these will be standard market rates which he adds are currently pretty low.

"The hardest part of getting people into farming at the moment is not interest rates."