“Innovation and sustainability is at the heart of what ASB stands for alongside unbeatable customer service. Environmental sustainability is both a challenge and an opportunity for New Zealand’s rural sector and ASB is proud to work with the rural industry to assist it to manage the challenge and realise the opportunity.”
The Rural Environmental Compliance Loan is a product designed to provide a low-cost funding option to assist farmers who are looking to upgrade their environmental compliance systems.
ASB developed the Rural Environmental Compliance Loan in response to customer feedback. New Zealand farmers are doing their best to ensure their farms are operating to the highest environmental standards, but the reality is that there can be considerable costs associated with upgrading systems, such as the fencing of waterways, which are all part of operating an environmentally responsible farm.
The project was not designed to financially benefit ASB and as such the loan is competitively priced at ASB’s cost of funding, meaning no additional customer margin is passed on – making it a cost-effective way for farmers to improve their environmental sustainability.
The only loan of its type in New Zealand (though ANZ has since launched a similar product), ASB’s Rural Environmental Compliance Loan demonstrates commitment to the long-term future and sustainability of farming in New Zealand.
From an industry perspective, the loan has aided positive conversations about farming and its place in New Zealand’s economy, which will lead to a greater understanding of the impact the agricultural sector has on the country as a whole.
• A loan designed to assist New Zealand’s farmers in their efforts to “go green”, by providing a low-cost option for farmers looking to upgrade environmental compliance.
• The costs are kept low due to the fact that the project was not designed to financially benefit ASB – funding is provided at an interest rate of 3.8%* on loans of up to $200,000.
• The long-term idea behind offering the loan, according to ABS, is to “create a domino effect whereby our farmers can cost-effectively comply with local councils and work on ensuring the future sustainability of their land” while also focusing on “productivity, supplying more food to the world market, which in turn leads to a flourishing industry, creating more jobs and strengthening the overall economy”.
* Rate as at January 31, 2014. Rates are subject to change.
Canstar’s verdict …
A loan at the cost of the lending rate (i.e. not a revenue generator for the bank) to assist with rural environmental compliance needs seems to be a very positive innovation for both the environment and New Zealand’s farming community.
As the loans being offered by the bank can be up to $200,000, there is the potential for farmers to save a great deal of money, in what seems to be a very altruistic (and ‘green’) initiative.
Responding to the award, Mark Heer, General Manager for Rural at ASB, reiterated the importance of the award. “Innovation and sustainability is at the heart of what ASB stands for alongside unbeatable customer service. Environmental sustainability is both a challenge and an opportunity for New Zealand’s rural sector and ASB is proud to work with the rural industry to assist it to manage the challenge and realise the opportunity.”