Patronage Program

Putting Cash Back in Your Pocket

Unlike most businesses that return profits to their investors, First South returns profits to our customers. When you borrow from First South Farm Credit, you become a member of our cooperative, which entitles you to share in our profits through patronage refunds. Our customers own the business—that's the cooperative way!

How it Works

When you borrow from First South, you become a stockholder/member in our agricultural cooperative and have the opportunity to share in the distribution of profits. At the end of each year, the First South Board of Directors may decide to retain the net income of the Association to strengthen our capital position, or distribute some or all of the income to our members. These distributions are called patronage refunds.

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Frequently Asked Questions About Patronage

Does patronage affect my borrowing costs?

Yes-but in a very positive way. Like other lenders, First South offers competitive rates and terms, which typically results in profits. When our board of directors elects to distribute a part of those profits, the distribution is allocated to our members based on the amount of interest the Association earned on their loans. As a result, patronage effectively lowers each member's borrowing costs!

How does patronage benefit First South?

First South may deduct qualified patronage (including cash and the retirement of nonqualified surplus) from its taxable income, making it a very tax effective way of providing value to our members.

How is the amount of a patronage refund determined?

The obligation to pay patronage is established by First South’s bylaws and board resolutions. As established by these governing documents, First South’s board of directors determines the overall amount of patronage based on profits as well as capital needs. As a regulated financial institution, First South must build and maintain adequate capital to ensure that we have the financial strength to continue serving our customers effectively. Therefore, distributions are made only if capital requirements are achieved.

Our record speaks for itself.


$12.9 Million

Amount of cash we are refunding in April 2017 to our members/borrowers in patronage from our 2016 earnings

$320 Million

Amount declared to our members/borrowers through patronage refunds consecutively since 1995