26 June 1998

Ploughback finance is a new concept

DOWDESWELL considers its Ploughback account to be a totally new concept in machinery finance and claims the service offers several advantages over hire purchase and leasing schemes.

Operated in conjunction with NFU Mutual Finance, the account provides farmers and contractors with a range of finance options to purchase Dowdeswell products.

Option A is to pay cash, B is to take a short-term finance offer of 0% interest, C is the option of taking a medium-term finance of 3.45% and D is to accept a variable rate offer of 2% over basic bank rate.

Options B and C are subsidised by Dowdeswell, while D has the advantage of spreading the buyers debt over a longer period. None of the options involve any fees or charges.

Once an option has been decided on, the month following signing – and for each ensuing month – the purchaser receives a statement for his account until the account is cleared.

If the cash option is taken the full balance is due on receipt of the first statement while other options require payments to be made via a direct debit arrangement.

Flexibility is built into the system. For example, if the cash option is taken and the payment not made, the account automatically reverts to the variable option – a minimum payment of £10/month or 5% of the outstanding balance at 2% over base rate.

Agreed monthly payments can also be changed although a request to reduce the amount may need underwriting approval.

Dowdeswell spare parts can also be placed on the Ploughback account subject to a minimum draw down of £1000 – a move designed to counter the continuing presence of non-genuine spare parts.

Unlike hire purchase or leasing, the implement becomes the possession of the farmer and with regard to tax, it is a cash purchase and the usual capital allowances can be made with interest offset against tax.

Dowdeswells Ploughback account comes into operation on July 1.

Ploughback – a new concept in machinery finance, says Dowdeswell.