We’ve previously discussed the FSA’s microloan program, with its possibilities for beginning farmers. With the end of the year approaching, there is now data concerning how many loans have been made, along with information on how many of the loans went to beginning farmers, veterans, or socially disadvantaged producers.
The National Sustainable Agriculture Coalition has an interesting article that delved into the microloan statistics. Most pertinent for Nebraska and South Dakota producers is that both states have made microloans, just not to the extent of other states. NSAC suggests multiple reasons: total number of producers, acreage size of operations, type of operations, FSA outreach and training on microloans, and other factors.
But what I find most interesting about the article is that promise that microloans hold for beginning farmers. Of all microloans issued, 68% went to beginning farmers. These microloans can (and did) cover many different operations, production methods, and producer needs. Of particular import, the microloans covered these expenses without need to resort to higher-interest options such as credit cards, lines of credit, or high interest loans. Less money paid in interest means more money for the operation and/or living expenses for the beginning farmer.
Ultimately, it is for the beginning farmer to determine whether microloans are a good fit for the operation and farming plans. If you want someone to discuss your operation with and whether microloans are a good fit, you are welcome to contact us. We’re happy to help!