Farmers and those living in the countryside may have a new bank from which to borrow or in which they can deposit money with the establishment of a Farm and Rural Credit Union.
The possibility was raised at a meeting of SAOS, the Scottish farm co-operative movement, in Crieff yesterday, with chief executive James Graham stating the organisation was “seriously interested” in the possibility.
With recent changes in the banking system in Scotland causing an escalation in complaints on charges and increased difficulty in getting loans, it was not too surprising that the option of carrying out a feasibility study into creating such a facility was given full support by SAOS members.
Graham said that, while the idea of such a bank was new in this country, they were well established in the United States, where there are more than 7,000 operating, and in Canada, where there are more than 700. Some of those go back to the early days of last century and they now have reserves totalling billions of dollars. Graham added they form part of the local business economy where they work alongside farmers and other rural businesses
The initiative in this country has been made more possible with changes to the financial regulations which support the concept of credit unions. Bob Yuill, also of SAOS, reckoned that it would take up to 12 months to carry out the feasibility work and even if the green light was given after that, it would be a minimum of two years before such a bank could be in a position to operate.
The bank would be mutually owned and would operate purely as a deposit and loan bank and it would come under FSA regulations he added.