Farming in South Australia has always required resilience, but the current dry spell in the Murray Mallee, Riverland, and Upper North regions is testing even the most seasoned producers. At Latitude Accountants, we understand that when the rain stops, the financial pressure starts to mount.

To help local livestock and grain farmers manage through these difficult times, the South Australian Government has introduced the SA Drought Loan Scheme. This $200 million initiative provides low-interest, concessional loans designed specifically for working capital to keep your gates open and your stock fed.

In this guide, we break down the technicalities of the scheme, the eligibility requirements, and how you can prepare your application to secure the support your business needs.

What is the SA Drought Loan Scheme?

The SA Drought Loan Scheme is a state-specific financial assistance program for South Australian primary producers. Unlike national programs like the Regional Investment Corporation (RIC) loans, this scheme is laser-focused on the most drought-affected regions of SA.

It provides loans of up to $250,000 with a total term of 10 years. The most significant benefit is the repayment holiday: you aren’t required to make any repayments for the first two years of the loan. This allows you to focus your cash flow on immediate recovery rather than debt servicing.

Key Terms and Interest Rates

As of early 2026, the interest rates for this scheme are highly competitive compared to commercial rates or even the standard RIC rates.

• Years 1–2: Interest is set at 50% of the Commonwealth 10-year bond rate. Currently, this sits at 2.41%. During this time, interest accrues and is added to your principal—no cash repayments are required.

• Years 3–10: The rate moves to 100% of the 10-year Commonwealth bond rate, currently 4.83%.

• Purpose: The funds must be used for working capital only. This includes direct cropping costs, livestock fodder, water carting, and general overheads.

• Important Restriction: You cannot use this loan to refinance existing commercial debt.

Are You Eligible? Eligibility Criteria for SA Farmers

Eligibility for this scheme is strictly governed by South Australian policy. If your farm spans the border into Victoria or New South Wales, please note that this specific scheme only applies to the South Australian operations and eligible councils.

1. Location and Industry

You must be a grain or livestock producer operating within the following eligible council areas:

• Karoonda East Murray, Mid Murray, Southern Mallee, Coorong, Murray Bridge.

• Renmark Paringa, Berri Barmera, Loxton Waikerie.

• Orroroo Carrieton, Peterborough, Northern Areas, and Mt Remarkable.

2. Business Structure

Your business must operate as a sole trader, partnership, trust, or private company within South Australia. You must have a valid ABN, be registered for GST, and not be under any form of bankruptcy or external administration.

3. Experience and Income

At least one member of the business must have owned and operated the primary production business for at least the past three consecutive years. Furthermore, this person must derive the majority of their income and contribute the majority of their labour to the farm under normal circumstances.

4. Financial Viability

You must be able to demonstrate that your business has a reasonable prospect of long-term viability with the help of this loan. Essentially, the bank (and the government) needs to see that while the drought has caused a temporary hurdle, your underlying business model is solid.

Common Questions: Food for Thought 

How much can I borrow under the SA Drought Loan Scheme?

Eligible farmers can apply for a loan of up to $250,000 to assist with working capital and day-to-day operational costs.

Can I use the SA Drought Loan to pay off my existing bank loan?

No. The SA Drought Loan Scheme is strictly for working capital and operational costs. It cannot be used to refinance existing commercial debt.

What are the interest rates for the SA Drought Loan in 2026?

For the first two years, the rate is 2.41% (50% of the Commonwealth 10-year bond rate). For the remaining eight years, it is 4.83%. These rates are subject to change based on the bond market.

Do I have to make repayments immediately?

No. There are no required repayments for the first two years. Interest will accrue during this period and be added to the loan principal.

What regions in South Australia are eligible for the drought loan?

The scheme targets the Murray Mallee, Riverland, and Upper North regions. Specific eligible councils include Murray Bridge, Loxton Waikerie, Peterborough, and Mt Remarkable, among others.

When do applications open for the SA Drought Loan?

Applications officially open in March 2026 and will remain open until 31 December 2026, or until the $200 million funding cap is reached.

How to Prepare Your Application

Preparation is key to a smooth approval process. The government requires a comprehensive look at your financial health to ensure the loan is a responsible choice for your business.

You will need to gather the following documentation:

• Tax Returns: Business and personal tax returns for the past three years.

• Financial Statements: Profit and Loss statements and Balance Sheets (Statement of Financial Position).

• Cash Flow Budgets: A clear projection of your expected income and expenses.

• Security: You will likely need to provide a registered mortgage over farming land to secure the loan.

Contact Latitude Accountants Today

If you are a farmer in the Murray Mallee, Riverland, or Upper North, let’s sit down and look at your options. We are committed to helping South Australian agriculture thrive, rain or shine.

Ready to secure your farm’s future? Contact the team at Latitude Accountants today to discuss your eligibility for the SA Drought Loan Scheme.

📞 Call us: 1300706597
📧 Email: info@latitudeaccountants.com.au

 Disclaimer:

The information provided in this blog post is for general educational and informational purposes only. It does not constitute formal financial, investment, legal, or taxation advice and should not be relied upon as a substitute for professional consultation with a qualified accountant or financial advisor.