Australia: Farm Finance for Concessional Loans

Last Updated: 27 August 2013

The Australian Government has committed $30 million for each of the next two years from 2013-14 (total $60 million) to provide assistance to eligible Queensland farm businesses in the form of concessional loans for debt restructuring. The scheme will be administered by the rural adjustment authority, QRAA.

Key features of the Concessional Loans Scheme

  • Loans of up to $650,000 for eligible farm businesses to restructure existing farm business debt.
  • Loan terms of up to 5 years.
  • Concessional Loan amounts will be less than 50 per cent of the total eligible debt of the farm business.
  • Variable concessional interest rate initially set at 4.5 per cent.
  • Interest only payments are available for up to 5 years.
  • Full repayment of loans required at the end of the loan term.
  • The availability of loans is subject to funds being available. The Scheme is capped at $30 million per year for 2013-14 and 2014-15. No more loans will be offered once this cap is reached.


To be eligible for a Farm Finance Concessional Loan you and your farm business should:

  • Demonstrate a history of meeting debt servicing requirements.
  • Be in need of assistance to meet current debt servicing requirements.
  • Have the ongoing support of commercial lender/s.
  • Be able to meet all financial commitments over the next five years if a Concessional Loan is provided.
  • Be able to repay the Concessional Loan within five years, for example, through successfully obtaining commercial refinance.
  • Be able to provide sufficient security for the Concessional Loan.

To be eligible for a Concessional Loan, you must:

  1. Demonstrate that you and your Farm Business:
    • Meet the eligibility criteria to be assessed for a Concessional Loan (see Clause 8).
    • Meet the criteria for eligible debt (see Clause 9).
    • Meet the Concessional Loan assessment criteria (see Clause 10).
  1. Complete and submit an application form (available at with:
    • The required supporting documentation including confirmation from your current commercial lender(s) of ongoing support if a Concessional Loan is approved.
    • A five year business plan.
  1. Provide a satisfactory security for the loan (see Clause 11).

Clause 8 - Eligibility Criteria for Loan Assessment

In order to be eligible to have their Application for a Concessional Loan assessed, Applicants must have lodged a completed Application with all the required supporting documentation. Applicants should note that lodging an Application does not guarantee that they will receive a Concessional Loan.

To be eligible for a Concessional Loan in Queensland, an Applicant must demonstrate that:

  1. They have owned and operated the Farm Business for at least the past five consecutive years, and their Farm Business:
    • Operates as a sole trader, trust, partnership or private company.
    • Is involved within the agricultural, horticultural, pastoral, apicultural or aquacultural industries.
    • Is wholly located in Australia.
    • Is registered for tax purposes in Australia with a Australian Business Number (ABN) and is registered for GST.
    • Is not a public company under the meaning of the Corporations Act 2001 (Cth).
  1. At least one Member of the Farm Business must be a Farmer who, under normal circumstances, contributes at least 75 per cent of his or her labour and derives at least 50 per cent of his or her income from the Farm Business.
  2. The majority of their Farm Business is conducted in the state of Queensland.
  3. At least one Member of the Farm Business is an Australian resident.
  4. They have the ongoing support of commercial lender(s) with the Concessional Loan assistance.
  5. Their Farm Business is not under External Administration or bankruptcy.
  6. The Applicant has not received a loan under the Farm Finance: Concessional Loans Scheme in any jurisdiction.

Clause 9 - Eligible Debt

Concessional Loans in Queensland are only available to refinance Farm Business related debt that has been established upon commercial interest rates and terms and conditions.

Examples of ineligible debt may include:

  • Private or family debt not provided at arm's length and at commercial interest rates and terms and conditions.
  • Equipment finance facilities.
  • Non-balance sheet loans.
  • Funding of normal or additional working capital (e.g. overdraft facilities).

Clause 10 - Loan Assessment Criteria

Applications from Eligible Applicants for the restructuring of eligible debt will be assessed by QRAA against the following loan assessment criteria. Applicants will be assessed against the loan assessment criteria in place at the time their completed Application is lodged, (noting that these criteria may be reviewed and amended in the future).

An Eligible Applicant for a Concessional Loan must demonstrate that:

  • They have taken all reasonable steps to service the debt.
  • Their Farm Business has been and is continuing to experience difficulties servicing its debt.
  • They have a financial need for a Concessional Loan.
  • Their Farm Business has the capacity to repay the Concessional Loan and sound prospects for a return to Commercial Viability within the term of the Concessional Loan.T
  • heir Farm Business has the ongoing support of its current commercial lender(s) for the availability of additional necessary carry-on finance.
  • The loan amount applied for is less than 50 per cent of the total eligible debt of the Farm Business.
  • The amount of Non-Farm Assets and Liquid Assets owned by the Applicant or the Members of the Farm Business is not more than the amount needed for prudent risk management.
  • They are able to provide QRAA with satisfactory security commensurate with the amount of the loan.

Eligible Applicants must also provide an acceptable Business Plan. A template is available on QRAA's website if required.

Clause 11 - Security

Successful Applicants must provide QRAA with satisfactory security in accordance with QRAA's established security requirements and commensurate with the amount of the loan.

The security provided must include:

  • A registered mortgage over land and or other assets satisfactory to QRAA.
  • Any other security QRAA considers necessary.

Where applicable, assets provided as security must be insured (e.g. against fire) to the satisfaction of QRAA.

Applicants are advised that QRAA reserves the right to act under its securities where terms and conditions are not met or default occurs.

Application Periods

Funds for Concessional Loans will be allocated across two application periods in the 2013-14 financial year. Concessional Loan applications will be assessed in the order of receipt.

The first application period for 2013-14 will open to applications on 16 August 2013 and close to applications on 31 October 2013. Funds of $20 million will be available for Concessional Loans in this period.

Details of the second application period for 2013-14 will be published on the QRAA website ahead of time.

Incomplete Applications will not enter the assessment queue until all required information is provided.

How to Apply

To apply for a Concessional Loan upon the commencement of the first application period for 2013-14, you will need to complete a Concessional Loan Scheme Application Form and Business Plan and submit to QRAA.

This publication is issued by Moore Stephens Australia Pty Limited ACN 062 181 846 (Moore Stephens Australia) exclusively for the general information of clients and staff of Moore Stephens Australia and the clients and staff of all affiliated independent accounting firms (and their related service entities) licensed to operate under the name Moore Stephens within Australia (Australian Member). The material contained in this publication is in the nature of general comment and information only and is not advice. The material should not be relied upon. Moore Stephens Australia, any Australian Member, any related entity of those persons, or any of their officers employees or representatives, will not be liable for any loss or damage arising out of or in connection with the material contained in this publication. Copyright © 2011 Moore Stephens Australia Pty Limited. All rights reserved.

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