Scots could get 95% advance loan on BPS money in September

Scottish farmers and crofters are being invited to apply for government loans, delivering up to 95% of their expected 2021 basic support payment as early as September, to aid cash flow and help with the post-Covid recovery.

The scheme was announced on Thursday (19 August) by Scottish rural affairs secretary Mairi Gougeon, who said it would give farmers vital support three months ahead of the traditional EU CAP payment period.

See also: NFUS proposes linking green outcomes to direct payments

If taken up fully by around 17,000 businesses, it will result in £337m of BPS and “greening” money being injected into the rural economy.

Loan offer letters are being sent to eligible businesses this week, subject to a £133,638 individual upper limit, with the first payments due in September – the earliest ever.

“There are a number of challenges arising from Brexit, including around food supplies,” said Ms Gougeon. 

“We are continuing to support our farmers and crofters so we that we can maintain domestic food security and help secure local supply chains.”

For the first time, farmers will be able to accept their loan offers online, which should speed up the payments process, although acceptance by email and post also remain available.

Cash flow

NFU Scotland president Martin Kennedy urged farmers to “opt in” online as soon as possible.

“Many farmers and crofters will be looking seriously at cash flows this autumn, particularly in areas where dry weather this summer has meant a significant amount of planning around availability of feed, fodder and bedding,” he said. “This loan scheme will be a huge help.”

NFUS pointed out that this is the 10th loan scheme from the Scottish government, adding that processes had continued to improve with each scheme.

Interest will not be charged on any loans, balancing payments will be made in December, and the option to receive payments in euros has been suspended.

A Scottish government Q&A briefing on the 2021 loan scheme (PDF) is available, as is guidance on how to accept the loan scheme offer online (PDF)