For many of us over the years banks have come to be seen as an industry which has prioritised its own interests, often to the detriment of its staff, shareholders and customers. A history of poor lending practices, management bonuses, loan sales, and various over charging scandals have created huge reputational damage for an industry that is a vital cog in the wheel of every business, big or small.
For every small business, including us farmers, banks are a necessary tool to manage our finances, even if we never borrow or save with them. For those of us who run small businesses, the need to be able to trust our banks is crucial as we neither have the time, or the expertise, to constantly check if every charge on our account is accurate.
The Irish Banking Culture Board (IBCB) was set up to restore the reputation of our banking industry. While we all understand that banks need to operate profitably, to do so, all the stakeholders involved must be treated fairly and equitably, especially our vulnerable and those who are at a particularly vulnerable time in their lives due to a sudden bereavement or life-changing injury.
Reputational change is a long-term project in which I’m optimistic the IBCB will have a major positive role to play. As a board member of the IBCB, I will be ensuring that our views as farmers and businesspeople will be heard loud and clear.
by Martin Stapleton Treasurer IFA & IBCB Board member
As part of our work on bereavement supports from banks, the IBCB has become aware of a wider societal issue regarding low levels of proactive planning to ensuring financial affairs are in order. If adequate financial planning measures are not in place, it can lead to additional difficulties and stress for bereaved families or those who experience sudden life-changing injuries.
The key financial steps to put in place include making a will and putting in place arrangements to give next-of-kin the ability to manage financial affairs in the event of diminished capacity or serious illness. This can include measures such as setting up a joint bank account, appointing a third-party adviser, or appointing an enduring power of attorney.
The IBCB is continuing to focus on the role banks can play in supporting customers with planning their financial affairs. In addition to dedicated bereavement supports, all IBCB member banks have specific supports available for customers in a vulnerable position, which includes those who are financially vulnerable as a result of a life-changing event such as a bereavement or injury. Each situation is unique, it may be temporary or ongoing and your bank will advise what supports are available to you. This is particularly important during the current COVID-19 crisis, where some who were vulnerable prior to COVID-19 may well now face an exacerbation of their circumstances, while a whole raft of others are now vulnerable solely because of the impact of the virus on their health and/or financial circumstances. If applicable, we recommend that you contact your bank either in branch, via their website or through their phone service and explain your situation as soon as possible.
In addition to the importance of getting financial affairs in order, IBCB research with the farming and SME communities has identified a need for more specific banking supports for these sectors, and a particular need for banks to look at their approach to relationship building and communications.
Previously, farmers and SMEs heavily relied upon their relationship with their local bank manager to facilitate their banking needs. With reduced branch networks and increasing use of online services, these relationships have changed significantly.
Feedback was received from farmers that when they try to access loans or financial advice, it can be difficult to speak to a staff member with experience in farm lending. In conjunction with our board members representing the farming and SME sectors, the IBCB is focusing on developing actions with our member banks which will assist with these difficulties. A key requirement is ensuring that farmers and SMEs are aware of the range of financing supports in place for them and how best to access these through, for example, the preparation of business plans. These supports will be particularly important given the economic and financial fallout from the COVID-19 crisis. Each of the IBCB member banks have SME financing expertise in place, and in some cases, dedicated agri teams, to provide specialist support.
The Banking and Payments Federation Ireland (BPFI) also provides information to assist businesses with financial planning and includes specific information for farm businesses in relation to finance applications (www.bpfi.ie). Additional information sources can be accessed through Micro Finance Ireland and Credit Review (https://www.microfinanceireland.ie and https://www.creditreview.ie)
IBCB CEO Marion Kelly and IBCB Board Member and IFA Treasurer speak to Embrace Farm about the role of Banks in supporting Irish Farmers.
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