Canada’s federal farm lending agency is expanding its loan offerings in agribusiness and agrifood with a new program aimed at young businesspeople.
Farm Credit Canada’s Young Entrepreneur Loan, launched Thursday in Ottawa during Canada Agriculture Day celebrations, will offer financing of up to $1 million per qualified applicant under age 40, at closed variable rates of prime plus one per cent.
The loan requires a 25 per cent minimum down payment. The credit can be used to buy or improve agriculture-related assets, or to buy shares in an agriculture-related business, including those in the agrifood sector.
The loan, which is expected to help finance ag retail, manufacturing and food processing businesses, is available with custom variable and five-year fixed rates and comes with no loan processing fees, FCC said.
“The Canadian agriculture and agrifood sector needs more young people to get engaged, because they bring the energy and innovative ways of thinking that grow the sector and keep it on the cutting-edge,” Agriculture Minister Lawrence MacAulay told high school students and industry professionals Thursday in Ottawa.
The Young Entrepreneur Loan has most of the same eligibility requirements as FCC’s Young Farmer Loan, launched in 2012 to help farmers under age 40 finance the purchase, expansions or improvements of a farm.
The Young Farmer Loan offers closed variable rates at prime plus 0.5 per cent. Its minimum down payment, however, was reduced in December to 20 per cent from 25. Its credit limit per loan was also doubled in December, to $1 million.
An applicant eligible for either the Young Farmer Loan or Young Entrepreneur Loan would first be assessed for whether his or her primary business is a farm or is an agribusiness such as processing or retail, an FCC spokesperson said.
Only one of the two loan offerings would be available in such a case, the spokesperson added.
“By providing specialized loans for young farmers and entrepreneurs, we are helping the next generation get established and contribute to Canada achieving its full potential as a leading food supplier worldwide,” FCC CEO Michael Hoffort said in Thursday’s release. — AGCanada.com Network