The COVID-19 pandemic is definitely changing the way agriculture is doing business and that’s true in the financial sector.
Farm Credit Services of America operates 48 offices in the region and currently those offices are running with a skeleton staff. Many employees are working from home. Executive Vice President of Business Development Ken Keegan says this has allowed them to limit walk-in traffic to protect their clients and their workers. Making the shift during renewal season is a challenge, he says, but they have made a smooth transition to conducting most business electronically.
“We have digital portals to work with people digitally. We obviously have phone and fax and texts to communicate with producers,” he says.
Payments are also being made by producers electronically, and Keegan says nearly 70% of their clients were already using remote deposit prior to COVID-19. All the offices also have payment drop boxes where farmers and ranchers can physically drop checks.
Keegan says they’re also using some creative methods to conduct business during renewal season.
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“Producers are coming by with physical documents that we’ve mailed to them in our U.S. Postal Service, and they’re dropping those in secure boxes, and we’re retrieving them using digital signatures to executive digital signatures where we can,” he says.
He admits they do have some clients that are internet challenged or limited by broadband services in the rural area they live in.
“In those cases, we’re working with them over phone, we’re also having limited interaction with them where we can to exchange information and act on loan requests," Keegan says.
First Dakota National Bank has also quickly made the transition to serve their clients without skipping a beat. Nate Franzen is president of First Dakota’s Agribusiness Division and he says business has not fallen off despite COVID-19. He says they closed their lobbies but have the drive-thrus open at their branches as normal, while many of their employees work from home offices.
“We can get a lot of work done and a lot of money out there and a lot of operating lines renewed and a lot of help to our clients by leveraging technology,” he says. They too are closing loans with electronic signatures to keep farmers and ranchers operating.
Franzen says where they must do in person meetings because of the lack of technology they are being very careful and conscientious and following social distancing.
“The flow of money is an essential part of agriculture and business and we want to keep that going even in light of this unique environment,” he says.
First Dakota also had just a few hours to gear up to process applications and help disseminate the stimulus dollars that were part of the $2 trillion CARES Act passed by Congress. This includes Small Business Administration loans that will go out to farmers and rural businesses.
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“Beginning on April 3 it was small businesses that employ under 500 people. So as that relates to agriculture it needed to be businesses including production that have a payroll, that have employees and can document their payroll and that’s what defines the loan amount,” Franzen says.
He says those businesses will be monitored for eight weeks, and if they use the dollars appropriately and continue to keep employees on the payroll, there is a forgiveness phase. Starting April 10 there was a second phase of applications designed for self-employed individuals and independent contractors. They are still waiting for guidance on that, but there will be portions of agriculture that will qualify for that program as well.
Franzen says they also do not have details on the $24.5 billion of direct assistance that will go to farmers, but he says they anticipate it will be handled like the Market Facilitation Program payments previously made. He says there have been historic and sweeping losses in agriculture, in particular in the livestock, dairy and corn sectors. He says this payment will make a difference for those operations and will hopefully keep them operating until the pandemic subsides and normal demand returns to the marketplace.
