Oxbury, the UK’s new specialist bank for farming and food – and the UK’s latest SME-focussed fintech – has released details of the new digital banking service underpinning the bank’s flagship product. Oxbury Farm Credit is an innovative new product giving farmers a revolving credit account enabling them to spread the cost of their raw material purchases to suit their cash flow.
Farmers spend over £9bn a year on purchasing raw materials to support production across the agriculture sector – yet over the past 10 years, traditional banks have reduced short-term overdraft facilities to farmers by over 25%. Oxbury Farm Credit is specifically designed to step-in and provide farms with greater support and flexibility in managing their short-term financing needs. Instead of asking SMEs to switch bank accounts, Oxbury Farm Credit can act as a complement to traditional bank overdrafts, but the Oxbury account will compete strongly on price, service and relationships.
Nick Evans, Managing Director of Oxbury said: “The agricultural supply chain is not adequately supported by the incumbent banks and needs a customer service and funding revolution. That’s why we set up Oxbury.
“Oxbury Farm Credit is a unique product tailored for today’s modern farming and food business and offers an entirely new way for farm businesses to manage their day to day finances. The digital banking experience that Oxbury offers farmers is unmatched in banking.”
Using Oxbury’s proprietary “OxP” banking platform, Oxbury Farm Credit offers a unique new digital account providing customers with an intuitive visual dashboard tailored precisely to the needs of farms and their suppliers, transforming the digital banking experience for UK farms.
Farmers will now be able to view all their distributor invoices and manage their payments, deposits and repayments from one place. The account automates and digitises significant parts of the usual business admin associated with managing farm cashflow. Oxbury Farm Credit also integrates with accountancy software and other critical services allowing seamless downloading of invoices to customers’ ledgers.
Oxbury’s digital banking service will be supported by an expert network of agriculture relationship managers along with full customer service support by telephone operated by advisers dedicated to agriculture finance.
Oxbury gained its full UK bank licence in early 2020 and is in its final mobilisation stages with invitation-only customers, before launching fully to the wider market in Autumn 2020.
The bank is targeting a 5% share of farm lending within five years of launch, in a market where 70% of lending is still controlled by the big four banks.
Oxbury Farm Credit solves the problem of farm businesses having to fund the raw materials (known in the industry as agriculture inputs) many months or years before receiving income from the sale of the produced goods, tying up valuable cash in the production cycle and holding back the growth of food production.
Farms and food producers face an unprecedented period of change during the post-Covid recovery. Brexit-driven farm payments reform and the wider challenges of a new global trading regime and environmental requirements require a dedicated and specialist financial partner to support this transition.
With a dedicated focus on farming, food and the rural economy, Oxbury will combine its agriculture and fintech expertise to provide farm business with purpose-built lending and savings products.