When the bank says yes to a $3 million loan, does that make it a good decision? Not necessarily. In Episode 13 of the Your Farm Business Podcast, host Tom Moir sits down with Mike Krause, founder and CEO of P2P Agri, to unpack the real relationship between farmers and their banks — and how to walk in with confidence.

Drawing on four years as a bank economist and three decades helping farmers put their numbers together for lenders, Mike explains what actually motivates a bank (hint: it's their shareholders, not your profitability), the three things every lender checks before approving finance, and the one grey area where a well-prepared farmer can genuinely move the needle on their interest rate.

It's a clear-eyed look at lending — why "set and forget" can quietly cost you, why the bank should never be your final decision-maker, and how to make the bank a partner rather than a risk.

WHAT YOU'LL LEARN:

• What really motivates a bank — and why their interests aren't the same as yours
• The three things every lender assesses: security, ability to repay, and you as a manager
• Why seasonal finance is priced differently to a land loan — and the catch with line-of-credit facilities
• The "set and forget" trap, and a cautionary tale of a farm sitting at 17% equity
• Why shopping your business around every few years keeps the big four honest
• The documents that get a loan over the line: business plan, cash flow, balance sheet
• How banks treat trends like carbon farming, green loans and AI
• Two banking myths worth debunking — and how to actually be "bank ready"

CHAPTERS:

0:00 Welcome 
00:57 Mike's background with banks 
02:01 What actually motivates a bank to lend 
04:34 The three things every bank looks for 
09:39 Seasonal finance vs buying land 
13:04 Common mistakes farmers make with banks 
16:26 What documents to bring to the bank 
18:47 The danger of "set and forget" — a cautionary tale 
21:54 Carbon farming, green loans & AI in banking 
25:29 How to be "bank ready" 
27:30 Two banking myths to debunk 
29:00 Where to find the financial literacy course 
31:05 Closing thoughts: treat your bank as a partner

ABOUT THE GUEST:

Mike Krause is the CEO and founder of P2P Agri, an Australian software and training business that helps farmers analyse profitability, model "what-if" scenarios, plan succession and make confident long-term decisions. P2P Agri delivers training one-on-one and in partnership with TOCAL Ag College in NSW.

LINKS & RESOURCES:

• P2P Agri (free demo & Essentials tier): https://p2pagri.com.au
• Plan to Profit financial literacy course — search "plan to profit tocal"
• "Farming the Business" by Mike Krause (GRDC)

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Learn more about P2P Agri: https://p2pagri.com.au