The loan aims to assist UK farmers in reducing ecological impact and improve environmental resilience
Lloyds Bank will be providing UK farmers with financial support and resources for agroforestry projects worth over £25,000.
The banking group offers financing for agroforestry costs through its Clean Growth Financing Initiative (CGFI), which features a zero per cent set-up fee for term lending on sustainable farming investments.
The loan will help UK farmers reduce their ecological impact while enhancing the financial and environmental resilience of their businesses.
Agriculture sustainability director at Lloyds Banking Group, Ben Makowiecki, shares his insights and practical tips to help farmers navigate the financial aspects of implementing agroforestry systems.
He said: “Agroforestry can significantly enhance farm productivity through higher land equivalent ratios (LER) compared to single crops, potentially achieving 120-140% productivity.
“This makes the land work harder, utilising vertical space, while bringing broader benefits, including increased biodiversity, enhanced soil health, improved water management and shade for animals,” he says.
To accelerate the transition, the bank has partnered with Soil Association Exchange (SAX), a comprehensive farm assessment tool and consultancy service.
“Using SAX, farmers can assess their current environmental impact and evaluate where to bring in on-farm changes while identifying funding options.
“This could include combining sustainability-linked bank lending alongside schemes such as SFI or the Woodland Trust MOREWoods scheme, sponsored by Lloyds Bank, which covers up to 75% of planting costs,” he says.
“Managed in the right way, agroforestry offers economic benefits, rewarding farmers for providing public goods, but also contributes to the environmental sustainability and resilience of farm businesses and the land.”
Makowiecki also advises farmers to consider all business planning aspects, including profit projections, production timelines, exploring new markets, packaging, and future equipment needs when applying for financing.
“We’ll fund agroforestry in the same way as other sustainable farming projects through CGFI, but it’s crucial to have a clear, comprehensive plan.
“This ensures all aspects of the project, from initial costs to long-term maintenance and market considerations, are thoroughly accounted for.”
