Westpac has created a $100 million fund to loan to drought-affected farmers, who will be able to offset money put away in good times against money they've borrowed.
It comes after Agriculture Minister David Littleproud piled pressure on the bank to let farmers offset farm management deposits against their loans.
Earlier in the week, Mr Littleproud encouraged farmers to tell Westpac to "jam it" and take their business elsewhere.
But the bank has now joined Commonwealth Bank, Rabobank, NAB and Rural Bank in falling in line with the minister's demands.
Westpac will offer an interest adjustment for customers with farm management deposits to effectively offset balances against eligible business loans.
ANZ is the remaining lender yet to offer a farm management deposit offset.
The $100 million fund will provide loans of up to $1 million to existing Westpac agribusiness customers at discounted variable interest.
An aerial view of the cattle feeding operation on the property 'Toorawandi' owned by Coonabrabran farmer Ambrose Doolan and his wife Lisa. Source: AAP
Drought-affected farmers with Westpac will also be able to defer principal and interest repayments for up to 12 months on existing loans.
Westpac's national agribusiness manager Steve Hannan said drought was the most difficult challenge farmers could face.
"Taking into consideration the widespread impact of the drought, we are committing $100 million to lend exclusively to eligible drought-affected customers to help them through these challenging times," Mr Hannan said in a statement.
