UK retailer Tesco has launched a new discounted climate and sustainable finance scheme for farmers in association with retail and commercial bank NatWest.
The scheme will be available to around 1,500 of the retailer’s farmers and offer preferential rates on funding to help them switch to sustainable farming methods.
The voluntary programme, designed with farmers’ input, will be available to farmers who are part of Tesco’s Sustainable Farming Groups for beef, lamb and dairy, the retailer noted.
Ashwin Prasad, group chief commercial officer at Tesco said, “We know a lot of our farmers are looking at ways to reduce costs on farm and move to renewable sources of energy at the same time, which is why we’re delighted to be partnering with NatWest in offering our green finance initiative.
“The initiative will provide our farmers with the confidence to invest in sustainable farming methods and infrastructure, while also helping us meet our target of reaching net zero across our supply chain by 2050.”
Financial Support
Research shows that more than 50% of Tesco farmers want to make changes, but need help accessing financial support for the investment required, Tesco noted.
Lombard, a UK-based asset funder and part of NatWest, will give Tesco farmers access to funding solutions for solar panels, wind turbines, biomass boilers, LED lighting, battery storage and combined heat and power systems.
Peter Huish, head of consumer industries at NatWest Group said, “At NatWest, we recognise the multiple challenges faced today by farmers, including the cost of transitioning to lower emissions practices. This is why we are excited to be launching Lombard’s partnership with Tesco and its farmers.
“This initiative further contributes to the UK’s climate goals and food security, as well as to NatWest’s pledge to provide £100 billion of climate and sustainable funding and financing by the end of 2025. We strongly believe that to deliver a more sustainable future, partnering with leading UK consumer companies such as Tesco, and their supply chains, will be critical.”
Sustainable Farming Groups
Since 2007, Tesco set up a series of Sustainable Farming Groups, including for milk, cheese, beef and lamb.
The new finance scheme builds on the NatWest’s commitment to the UK agricultural sector.
Previously, the bank confirmed an additional £1.25 billion lending package for farmers, taking its total lending capacity to the agricultural sector to £6.7 billion.
According to Dave Jones, chair of Tesco’s Sustainable Dairy Group, access to finance is the biggest barrier when trying to install green technology.
Jones explained, “As TSDG Chairman, it’s great to see so many fellow dairy farmers considering more sustainable production methods like installing renewable energy technology on farms. However, accessing financial support for significant projects like this remains a barrier for many farmers.
“That’s why it’s great to see Tesco and NatWest joining forces to offer financial assistance that could help us install the new technology we need, and reduce farm emissions in the process.”
