Independent Banker - September 2023 - 50

intended, " he says. " Because of
technology, both the borrower and
the lender are going to have an
opportunity to be more effective
in what they're doing. That's why
there's an awakening and a desire
for change. "
DATA-DRIVEN PROCESSES
Among the forces driving
community banks with ag lending
arms to embrace technology, the
greatest is arguably tech-savvy
farmers themselves.
" Farmers have been the
protagonists in pushing digitalization
efforts within ag lending, " says
Ben Maddox, vice president of
business development at Acres
in Fayetteville, Ark. " Farmers are
pushing and driving a lot of change in
the industry. "
What do farmers want from the
lending process? Above all, says
Maddox, it's speed.
As a platform for analyzing
farmland that's to be bought or sold,
Acres could be seen as the Zillow
of the ag space. " The digitization of
sales records for farms has allowed
ag lenders to underwrite loan
applications faster because they have
a large amount of data to pull from, "
says Maddox. " Lenders can see that
farms like [a particular] property have
sold at this price in this area over the
last 12 months. "
Unlike on Zillow, however,
farm valuations are not straight
comparisons between neighboring
properties; the price for a given parcel
depends on the quality of the soil,
access to water and other productivity
measurements.
Maddox notes that just as
databases of property sales records
have been digitized, so have the
production histories of farms.
" Everything that happens on a farm is
now saved in the cloud, " he explains.
" So, when a lender says, 'I'd love to
give you a loan on that property, but
I'm going to need some information
to support my underwriting decision,'
the farmer can send a link and show
the full production history. "
In addition, tech has remade the
rules of how loans are closed.
" You used to not be able to close
an ag loan remotely. You had to go to
the county courthouse, " says Jackson
Takach, chief economist and senior
director of strategy, research and
analytics for Farmer Mac. " With
the pandemic, we learned we can
do what we need to do without
human interaction. "
Data is critical at all aspects of
the funding process, explains Aaron
Magenheim, CEO and founder
of AgTech Insight, an agriculture
technology consulting firm in
Salinas, Calif.
" Farmers need to know where
they're at in the loan process, [in]
real time, without having to make a
Zeke Holcomb, pictured,
is the son of rancher and
entrepreneur Jay Holcomb,
a customer of First
Financial Bank.
" If a farmer wants to refinance a loan
or is looking at a purchase in April
or May ... [they don't] want to get off
the tractor or combine to get three
to five' years of tax returns and
balance sheet verification. "
Kevin Stith, First Financial Bank
50 // ICBA Independent Banker // September 2023
Photo courtesy of First Financial Bank
Independent Banker - September 2023

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