Soil Association survey included responses from over 100 UK farmers
Banks need to rethink how they support farmers to help them shift to systems that prioritise nature and the climate, a Soil Association Exchange survey has suggested.
According to the farmer-led research from the environmental monitoring platform, the study revealed an absence of financial solutions and advice that recognises the complexity of the transition that farmers are looking to make in order to make their farms sustainable.
The study, named ‘Banking for Change: Addressing Financial Risk as a Barrier to Farm Transition’ included responses from over 100 UK farmers, with support from the Green Finance Institute and the British Business Bank.
It found that most farmers think financial and business risks are barriers to a transition to agroecological farming systems, but access to lending itself was not seen as the primary barrier.
Instead, farmers highlighted the need for flexible and preferential terms on either new or existing lending schemes.
According to the Soil Association, this would give them the capacity and space to navigate transition without financial risk to their farm business. This flexibility, combined with long-term business advice, was seen as essential for a successful transition.
Chief executive at the Soil Association Exchange, Joseph Gridley, said: “This research shows that while farmers are ready and willing to make changes to address climate and nature, financial barriers remain a major obstacle.
“Importantly, however, farmers are not simply looking for new loans. What they told us is that they need the lending flexibility and business support from their bank to help them through the transition because they cannot burden the financial risk.”
He added: “Supporting farmers is not just a job for government. It is clear that banks and development finance institutions have a critical role to play in helping farmers manage the risks associated with transitioning to more sustainable systems, but they need to radically rethink how they are doing it today.”
Tony Greenham, managing director of sustainability at the British Business Bank, which helped fund the research, added: “The findings underscore the importance of providing flexible and truly innovative financial solutions that align with the specific needs of farmers during this critical transition period.
“Supporting the agricultural sector’s move towards sustainability is not only necessary for climate resilience and nature restoration, but also for the long-term financial success of farming businesses.”
It comes as the NFU has slammed the recent Labour budget for threatening family farms and making food production more expensive.
