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HSBC is committing a £300m lending fund to support agricultural businesses in the UK, as part of its wider support package to help British businesses realise their growth ambitions.
Neil Wilson, head of Agriculture at HSBC, said: “We have enormous expertise in the agriculture sector and as a key focus for us, we want to be able to support customers, both old and new, even more.
“The Agriculture Fund demonstrates our commitment to doing this, and we hope we will lend even more than £300m to help ambitious British agriculture and farming businesses achieve their goals.”
The Agriculture Fund is the latest initiative from HSBC, which forms part of its £10bn SME fund to help businesses across the UK grow and prosper, both in the UK and internationally.
HSBC continues to be open to lending, having approved 91% of small business lending applications in the last year.
Increasing sheep numbers and becoming profitable
One such agricultural business that has benefited from the SME fund is Peter and Vicki Hedley's farm which they set up on their own in the Scottish Borders in 2013.
Initially, they rented their upland Less Favoured Areas (LFA) farm until they were given an opportunity to buy it as the short-term tenancy was coming to an end, despite previous assurances it would be extended.
HSBC provided long-term loan funding to allow it to buy the farm and the business has since grown, with the couple subsequently taking on a 500-ewe contract farming agreement.
The couple, who are in a partnership, specialise in selling Cheviot mule ewe lambs at Longtown, with the fat lambs sold through an agent to the Sainsbury producer group while 160 to180 cattle are all bought and sold through S Kirkup Livestock. They have gradually increased numbers from profits earned.
Support package
HSBC's SME support package includes a £10bn UK-wide fund for SMEs, allocated regionally across the UK – including the dedicated £300m agriculture fund.
It also includes a free banking offer of up to 18 months for startups and 12 months for switchers and a fixed-price £5.50 monthly account tariff to commence at the end of a customer’s initial free banking period.
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