Agriculture in Alberta has become an old-timer's game, but the Provincial Government is trying to change that.
Over the last twenty years, the amount farmers over the age of 55 has increased, and the amount of young and middle-aged of agriculture has been in a steep decline.
The Alberta government is trying to change that through changes made to the Agriculture Financial Services Corporation (AFSC)'s Next Generation Loan Program.
Agriculture producers need stable sources of capital to help manage and grow their operations and help farmers deal with economic challenges.
By expanding the eligibility and updating the Loan Program terms, it will make it easier for producers to enter and re-enter the agriculture industry, give greater opportunities to both new and growing operations, make succession more appealing, and encourage new and younger people to get into farming.
"By updating and expanding the Next Generation Loan program, young and young-at-heart Albertans will have fewer barriers when entering Alberta’s agriculture industry," explained the Minister of Agriculture and Irrigation, RJ Sigurdson, in a media release from July 30th. "Increasing new and returning entrants to agriculture will ensure the sector continues to be a healthy and important contributor to Alberta’s economy."
This loan has a low interest rate compared to all other ag lending market loan programs.
With the new changes in eligibility, there will be increased interest rate incentives, a lower ownership percentage requirement, and increase the time available for interest-only loan payments.
Now, under the new eligibility rules, producers of any age who are either entering or returning to farming are eligible for a one per cent interest rate loan, whereas before only those who were under the age of 40 were eligible.
Additionally, producers were previously only able to receive up to a lifetime loan of $1 million but are now eligible for upwards of $1.5 million in a lifetime loan.
On top of that, applicants are now only required to own 20 per cent of the farming operations, which is down from the previous 25 per cent, and now eligible borrowers are able to make "interest-only" payments on their loans for up to five years.
The new eligibility changes will take effect on September 1st.
To learn more about the Loan, click here.