UK bank HSBC offers farmers discounted loan fees to support sustainable practices
HSBC UK has launched the HSBC Sustainable Farming Pathway with sustainable farming charity Linking Environment and Farming (LEAF) its first partner on the scheme.
Farming businesses with the LEAF Marque certification, or those that complete a LEAF Sustainable Farming Review, will be eligible for discounted loan arrangement fees on term lending amounts from £25,001.
Being part of the HSBC Sustainable Farming Pathway means clients can receive an arrangement fee of 0.5% on amounts between £25,001 and £25 million. It also provides access to practical guidance through HSBC partners such as LEAF.
Lending in scope includes flexible business loans, commercial mortgages and property development loans.
Martin Hanson, head of agricultural banking at HSBC UK, said the initiative intends to help farming businesses transition to more sustainable techniques.
“HSBC UK is a significant lender to farms in the UK and our research shows around two-thirds (70%) of farms are currently making commitments to transition to sustainable practices. By working with LEAF and future partners, we have the opportunity to directly support farmers who want to make sustainable choices.
HSBC UK serves over 14.7 million active customers across the UK, HSBC UK also found that more than two-thirds (70%) of UK farms are engaged in agri-environment schemes, as defined and recognised by DEFRA, to support nature and biodiversity enhancements.
Regular sustainable practices are already taking place with around a third (38%) of farmers regularly soil testing fields to inform NPK applications while 28% of dairy clients have undertaken a carbon audit.
To become more sustainable, farmers identified the areas they want to invest in as renewables (54%), slurry storage (22%) and energy efficiency (20%).
Clare Mike, LEAF’s director technical & business development said: “LEAF Marque farmers are increasingly focused on incorporating sustainable practices into their operations. They’re reviewing how to best balance soil sensitivity, enhance landscape and nature habitats, protect water, invest in renewables and boost biodiversity.
“Sustainability is high on the agenda for the UK’s agri sector, and the new HSBC Sustainable Farming Pathway can help many businesses in their transition journey.”
Phillip Wynn OBE, Chair of The Board of Trustees at LEAF, added: “As the first bank to offer discounted loan fees to farms certified to the LEAF Marque standard, HSBC UK is harnessing its role as a key lender in the UK agriculture sector to support environmental practices through our accredited management standard.”
How does HSBC define sustainable practices?
The LEAF Marque is widely used and, in some cases, required by large retailers. It demonstrates the environmental and business commitment of individual business through Integrated Farm Management. This is a whole farm approach that includes soil and water management, pollution control, energy efficiency, landscape conservation and community engagement.
The LEAF Marque certification system is a whole farm approach covering nine core areas including soil and water management, energy efficiency, animal husbandry, pollution control, crop protection and landscape and nature conservation. “It provides flexibility for businesses to adopt and adapt what works for them and a framework to facilitate and monitor continuous improvement, as well as engaging wider society,” an HSBC spokesperson told AgTechNavgator.
What kind of tech will be adopted by farmers?
The kind of technologies expected to be taken up by farmers are vast, HSBC added. Examples include precision agriculture; remote sensors; satellite imaging and digital twins and modelling; robotics; bioacoustics; drones; and carbon calculators.
“All of these will help support continual improvement as well as provide additional data which will not only help farmers make better, more informed management decisions but also demonstrate impact."
