Rural financial counsellors are reporting a rise in farm businesses seeking help with farm debt mediation and asset management as high input costs following several years of bushfires, COVID-19, floods and more recently dry seasonal conditions in parts of the state erode profitability and serviceability.
The Rural Financial Counselling Service (RFCS) NSW, which supports farming families and small business across southern and central NSW, has observed the trend, signalling a broader tightening across the sector.
“We’re seeing more clients come to us for real, structural support especially with farm debt mediation and decisions around asset management,” RFCS NSW CEO Craig Hough says. “Time is often the critical factor - ideally we’d like to see clients before they take out the loan so as to avoid these costly situations for everybody.
“Our rural financial counsellors work with clients on cashflow forecasting and budgeting, help identify areas of risk, build a tailored business plan, and connect them with government support where needed, giving them the tools to make decisions from a position of strength, not pressure."
The service is also urging farm businesses feeling the pinch to approach creditors and lenders early with a clear plan, rather than waiting until a payment is missed. RFCS NSW counsellors say most lenders are willing to work with borrowers who come to the table prepared.
To support producers through these conversations, RFCS NSW has released a free, downloadable resource outlining five practical steps - act early, be honest, prepare your information, propose solutions, and get agreements in writing - alongside a checklist of documents and details to have on hand, including financial statements, tax returns, council and Local Land Services rates notices, loan details, insurance certificates and business and succession planning information.
“Walking into these conversations prepared makes a real difference. It saves time, builds credibility with the lender, and helps get to a workable outcome faster,” Craig says.
The full checklist is available to download at https://bit.ly/4gCSU1U.