Drawing from my experiences of this year’s round of banking and agricultural lending schools, the changing landscape of the industry is clear. Because of this, let’s examine some of the trends emerging with lenders and the lending industry as we near the close of the second decade of the 21st century.

One interesting shift is that where there were once traditional agricultural economic students from land-grant schools, there are now lenders with business and liberal arts degrees from smaller agriculture schools, or those with no agricultural programs at all. And as many land grant institutions have moved away from the agribusiness and classic programs in economics, the recruitment of individuals interested in agricultural finances has relocated to the colleges of business and other departments that are somewhat disconnected with agriculture. Nevertheless, the agriculture industry increasingly needs economists and finance majors especially as the lenders from the Baby Boomer generation are retiring.

Next, to compound the educational disconnect, in many cases, today’s agricultural lenders do not have a farm or ranch background. In fact, some lenders are transitioning into agriculture with experience in commercial or consumer loans. This creates a tremendous need for education as the unique nature and challenges of agriculture are much different than the other sectors of the lending industry. 

Another leading trend is the evolution of a more diverse lending industry. Often, over half of the lending class attendees were female and several minority groups were represented. This trend parallels that which is also seen in youth agricultural organizations such as FFA and 4H.  Excitingly, this brings a whole new energy and valued insight both to the agricultural and lending industries.

The agricultural lenders of the future will come from Gen Z; those born between 1995 and 2012.  And in many ways, this generation differs from the Millennials. For example, Gen Z individuals tend to relate well to the Baby Boomers, but sometimes conflict with Generation X.  Historically, some young people can clash with their parents, but more readily connect with their grandparents. This may be the reason behind why Gen Z tends to relate easily with the Baby Boomers. 

Regardless of demographic, gender, or educational focus, the real test of success for new agricultural lenders is the combination of their competence with today’s technology and their human relations skills. They must demonstrate the ability to think critically, problem-solve, and utilize data and information to accurately connect the dots.  And finally, they will need excellent communication skills. Speaking, listening, and social interaction skills will be valued highly along with good old-fashioned hard work. 

As you and your new agricultural lender interact at the county fair, trade shows, in the office, or on the farm, you may observe one or more of these trends among others.  Similar to changing consumer trends or volatile markets, the producer’s ability to adapt will be critical to success on the money side of the business.