Input finance to support more efficient cash-flow - Who uses?

[Happy at it]

Interesting - Any example rates for comparison perhaps?

Current od is 5% over base. Had questioned others on her a few yrs back what was being paid and some were as low as 1.5% in england.

Try the search feature on here and apply whatever is a keyword like interest or overdraft to the titles. Be surprising what information you could be of use to you

 

[Johnnyboxer]

All this sounds very much like payday loans for farmers. A bit of desperate 'last resort' finance for those that have hit their overdraft limit and whose bank is unwilling to extend it.
Am I on the right track?

Think you are on track

 

[DealeyPlaza1963]

@A-Owen Your location in Cheshire is in the same place as a certain Lex Greensill - he of Greensill Supply Chain Finance 'fame' - Irrespective of the questions surrounding the individual, do you have any thoughts regarding the suitability of this type of financial instrument to being used more widely as a finance option by the UK Ag industry?

 

[Johnnyboxer]

Geeze!! Who was that with?

I looked in to providers such as Hitachi, Fram Farmers, UK Ag Finance and Oxbury who all offer 'input finance'. I'm trying to determine if there is a gap in the market for a competitive alternative to a bank overdraft or trade finance that can support farmers with genuine low-rate costs for everyday farm inputs such as crop protection products, fertilisers, fuels, seeds and animal feeds, or for capital expenditure perhaps to help improve farm productivity, i.e. new grain stores or renewable energy installations (examples only but you get the idea) - thoughts?

In an idea but realistic world, i'm keen to hear what farmers would like from a finance provider that is not being offered through todays mainstream banks - Low rate + ??? as @SilliamWhale I too believe there could be a decent market here, only many banks appear to be pulling back and at a time when most needed. So to shape what is really wanted/needed, i'm interested to hear direct from the horses mouth so to speak... or farmers in this case

It’s all been done before to a greater or lesser degree

Merchants have always offered terms, for alternative payment options and usually added at a £1 or two onto the price

Now they want to formalise it, hence Oxbury opening up

Traditionally Finance companies have dabbled in and out of it for many a year, as the mood and market takes them

Problem is that it’s largely unsecured, short term (<12 months or less) and therefore the interest rate is higher. It also needs to be highly automated for credit underwriting and processing as ‘real people’ add significant cost to each agreement.....Therefore many finance companies find it not hugely attractive


NFU Mutual Finance with their 20:20 cheque book account was ideal for farmers, easy to use and the bank to administrate - but sadly gone now

 

[Clive]

That changed pretty quickly....

just looking out for you all, having spoken now she is genuine

 

[lloyd]

just looking out for you all, having spoken now she is genuine

That is so kind you can never be too careful nowadays

 

[jendan]

just looking out for you all, having spoken now she is genuine

What happened to Miss Borlaug (?) She got a very frosty reception on here.

 

[Clive]

It’s all been done before to a greater or lesser degree

Merchants have always offered terms, for alternative payment options and usually added at a £1 or two onto the price

Now they want to formalise it, hence Oxbury opening up

Traditionally Finance companies have dabbled in and out of it for many a year, as the mood and market takes them

Problem is that it’s largely unsecured, short term (<12 months or less) and therefore the interest rate is higher. It also needs to be highly automated for credit underwriting and processing as ‘real people’ add significant cost to each agreement.....Therefore many finance companies find it not hugely attractive


NFU Mutual Finance with their 20:20 cheque book account was ideal for farmers, easy to use and the bank to administrate - but sadly gone now

We are working on something new for TFF members which will hopefully launch in October that will not only access lower prices but will (if uptake is good) bring a new kind of input credit / online payment just for farmers ................. wish I could say a bit more but subject to NDA etc right now

 

[Clive]

What happened to Miss Borlaug (?) She got a very frosty reception on here.

Midlands Asset Finance ? they are still sited sponsors

 

[jendan]

It’s all been done before to a greater or lesser degree

Merchants have always offered terms, for alternative payment options and usually added at a £1 or two onto the price

Now they want to formalise it, hence Oxbury opening up

Traditionally Finance companies have dabbled in and out of it for many a year, as the mood and market takes them

Problem is that it’s largely unsecured, short term (<12 months or less) and therefore the interest rate is higher. It also needs to be highly automated for credit underwriting and processing as ‘real people’ add significant cost to each agreement.....Therefore many finance companies find it not hugely attractive


NFU Mutual Finance with their 20:20 cheque book account was ideal for farmers, easy to use and the bank to administrate - but sadly gone now

The trouble is a farm should be able to function and pay inputs from their previous years trading,or have sufficient working capital in reserve for bad times.All these loans are very expensive.If it doesnt stack up with a small overdraft,then its not worth doing.I have seen farms take out these high interest short term loans,and before they are paid off,need to take out another one to finish paying the first one off.From then on,it is a downward spiral,the bank picks up on it eventually and ruthlessly pulls the plug.The borrower has not a leg to stand on; "you went behind us and racked up all this debt,dont expect us to bail you out"

 

[A-Owen]

That changed pretty quickly....

Indeed we talked shortly afterwards, you know about my takeover of TFF

 

[farmerm]

some farmers are cash rich at times and others cash poor some or all of the time.. I have often wondered if there would be a mechanism for those sitting on cash to get a return by lending it to those in need of cash.. A peer to peer pawn network of some form? Perhaps one party loans the other cash and takes possession of an item of greater value as security such as a tractor or an implement. The loan is repaid with interest and the item returned or the lender become the legal owner of the security asset. The cost of transporting assets around does rather limit the radius in which exchanges would work though.

 

[goodevans]

Can you get some pics on the ohhhh thread and let badly know then if you're in charge

 

[A-Owen]

What happened to Miss Borlaug (?) She got a very frosty reception on here.

Who's Miss Borlaug?

 

[SilliamWhale]

Basically however you package up any of the lending and its source it comes down to price at the end of the day.

Obviously you can pay more for flexibility over and above some elements of bank lending which has its merits but most people just want to know the APR.

 

[A-Owen]

Can you get some pics on the ohhhh thread and let badly know then if you're in charge

My pic has caused quite some discussion... funny. The 'ohhhh thread' - really such thing? My Insta is 'mamaowen16' where there's more pic's. You'll see that I'm a legit, normal everyday kinda gal

 

[jendan]

Who's Miss Borlaug?

Similar to you i think.Trying to get business on this forum.I felt she was rather harshly treated by some other forum members.

 

[capfits]

Gotta be one of the strangest money management threads I have seen on here.
At the end of the day it appears to be just another (yet undisclosed) way of selling money.
Personally with the sums involved I really struggle to see how it can be competitive against an overdraft.

 

[Johnnyboxer]

Who's Miss Borlaug?

Borlace

 

[A-Owen]

Similar to you i think.Trying to get business on this forum.I felt she was rather harshly treated by some other forum members.

Oh. I'm not employed, nor am I pitching anything to gain business. I enjoyed the part of my role in AgChem where I could do things for the better good of you will. I was involved in some sustainability projects which I thoroughly enjoyed as I worked closer with farmers which wasn't the norm. In AgChem, you'll know that the relations and Marketing are predominantly distributor focused. I lean more towards the farmer first focus, therefore since being out of work and having time to reflect and look at what next... I very much enjoy Marketing, but more than that i'm passionate about being able to make a positive difference somehow so without approaching a competitor AgChem company, i'm looking at opportunities outside of that but still within Ag, hence farmer finance is just one area of exploration as money is a necessity for any business. I have no agenda, just finding my feet I guess in the hope I can in some way support the farming industry.

Thankfully everyone on here has been very welcoming... I guess it helps to know I am legit (thanks @Clive) so I can understand some initial scepticism. Mostly, the responses have been really helpful from an insight perspective but also pretty entertaining too