When I’m chatting with a farmer, my favourite question to ask is what he or she would do if they suddenly gained extra financial wiggle room in their farm business. Many say they’d store their crop a little longer on-farm to capture a better marketing edge. Others say they’d pay off real estate or operating debts to save the big bites interest fees take from their bottom line. Some say – always with a grin – that they’d buy the ‘toy’ — that bigger, better tractor or faster, shinier combine. I’ve truly never run into a farmer who couldn’t think of at least a few good ways to put extra cash to work. Too bad cash is hard to come by… or is it?
The federal government currently offers a valuable, unique-to-farming financial perk that more and more farmers are utilizing. The Advance Payments Program offers low-interest cash advances of up to $1 million, with $100,000 interest-free, for up to 18 months on crops and 24 months on livestock. That’s it — no strings, catches or limitations.
The program is currently administered by over 30 different organizations, mostly commodity groups. Though all offer the same program benefits, different administrators charge surprisingly different lending rates on the interest-bearing portion of the loan, as well as varying administration fees. Too, each processes the program in more or less cumbersome ways.
Six years ago, when the Alberta Wheat Commission started looking into the program, we became frustrated by the fact that this farmer-centred program was not always administered in ways which best benefit farmers. That’s when we committed to becoming an administrator ourselves, with the express plan of rolling out the most farmer-oriented version of the program possible.
Fast forward to today:
At the risk of sounding proud (I’m willing to take that risk: I AM proud!), the Alberta Wheat Commission has achieved our goal in spades. Our FarmCash program offers farmers the federal government’s Advance Payments Program on over 50 commodities including all major crops, honey and livestock with no administrative fees of any kind and at TD prime minus 0.75 per cent, the lowest interest rate offered by administrators. We are the first and only administrator to offer a web-based application platform with innovative features including electronic signature and document upload. Furthermore, we are fully transparent in our financials and entirely committed to reinvesting any future surpluses into initiatives that benefit farmers.
One other thing that sets us apart? Availability. We’ll answer your phone calls and emails, whether you’re looking for information, asking a question, or sending pictures from the vacation you could finally afford, thanks to better cashflow management through FarmCash.