Get started
Cirralto signs strategic partnership with Australian Agri Finance to grow farm lending services

22 December - 3 min read

Key Highlights
  • Cirralto has signed a binding agreement with Australian Agri Finance (AAF) and its parent company In Front Australian Business Solutions Pty Ltd (In Front) to deliver farm enhancement lending and input financing.
  • The In Front group of companies are based in Perth & Adelaide. They specialise in Equipment Finance & Agri financing and have a large portfolio of more than 2000 customers across Australia.
  • Australian Agri Finance will work with Cirralto to refer pilot farms for the Company’s Carbon offset finance products.
  • The first 3 successful referrals have resulted in customer transactions and delivered revenue and cash receipts in the current quarter.
  • The agreement follows Cirralto’s strategic loan funding investment announcement in April 2021 where loans made to Invigo preacquisition were used to establish this relationship.
  • To manage our growth in Agricultural lending Cirralto has appointed Mr Andrew Negline who will be joining the Company as the Head of Agricultural Lending.
Cirralto Limited (ASX: CRO, “Cirralto” or “the Company”) is pleased to announce that it has signed a binding agreement (“agreement”) with In Front Australian Business Solutions Pty Ltd and its subsidiary Australian Agri Finance (“AAF”).
Through this agreement, Cirralto will deliver farm enrichment lending, coupled with farm input procurement, and farm financing for livestock and mixed farming. AAF has a wide variety of existing farming customers, providing Cirralto with the opportunity to launch its various Agricultural Lending products to service AAF’s client base.
The agreement was established from a relationship secured with Invigo, prior to acquisition by Cirralto, from the strategic loan funding investment announced by the Company in April. The original purpose of the loan funding agreement with Invigo was to act as a catalyst to unlock multiple lending commercial opportunities, which has been realized through this announcement.
CRO and AAF share an ideological alignment on farm financing that focuses on creating outcomes that produce increased farm yield and in turn improved profitability of the farm business.
Cirralto has been developing Carbon based finance products that enable farmers to unlock capital for farm inputs and equipment by using the untapped Carbon asset that currently is seldom considered an asset on the balance sheet.
Cirralto’s growth in Agricultural finance is strategic and designed to connect with the Farmers Federation of Australia’s targets to increase farming production from A$65B to A$100B by 2030, a target endorsed as an Australian Federal Government¹.
To achieve this goal, AgriFutures‎‎² has identified a need for farmers to access a further A$8.7B in farming capital per year to meet these targets.
The agreement which taps into the market opportunity outlined above and demonstrates two of the four Agricultural Lending products developed by the Company; Farm Enhancement Lending and Input Finance.
  • Farm Enhancement – Farm Enhancement is designed to stimulate farm outputs and increase production and yields. Farm Enhancement is a capacity lend with repayments provided over a 12 month period.
  • Input Finance – Input Finance provides a facility for farmers to access upfront cash to fund farm inputs such as fuel, transport, fertilisers and nutrients. Repayments are delayed until after the inputs have taken effect and effectively increased farm outputs.
  • Grain Finance – Providing farmers access to a facility designed to be used to pay for the storage of grain and fresh produce once it’s harvested. This allows farmers to sell their produce when there is less competition in the market so they can earn more from their harvest. Grain Finance is traditionally provided over a six month period.
  •  Livestock Finance – Providing a loan to assist with the purchase of livestock. This cash injection is designed to help farmers pay for feed and other requirements needed to grow the animal to maturity without any upfront capital outlay.
  • Carbon Finance – Is an advance against the farm owners assessed carbon credits that can be utilised during the period before, or between, carbon payments and will secured by the assignment of future carbon payments.
The Company intends to continue growth in the agricultural lending sector and has appointed Mr Andrew Negline as the Head of Agricultural Lending to support future partnerships.
Mr Negline has more than 25 years of global experience in the red meat ad livestock sector and will be instrumental in aggregating demand for Cirralto’s Agricultural Lending services.
Commenting on the initiative, Adrian Floate, CEO of Cirralto, said “This agreement is the first of its kind for Cirralto, and will see us working across the entire value chain from the farmer themselves to their suppliers and upstream partners who offtake product and facilitate transport.”
Shane Smith, Managing Director of In Front Group, said “We recognise the opportunity in WA and SA to develop mixed-use farming loans for fresh produce, cattle and sheep and expand these opportunities to the East Coast of Australia. This agreement represents a typical customer in the Agri-finance sector.”
¹CSIRO & Australia’s National Science Agency, Growth opportunities for Australian food and agribusiness – Economic analysis and market sizing.
‎²AgriFutures & NCEconomics, 2021, Capital requirements of Australia’s agriculture, fisheries and forestry sector.

Related Articles

Subscribe to our blog       

Invoice Finance

To learn more about our invoice finance solution, fill out the form below and one of our team will be in touch.