Greening and growing
Fifty-five Irish Credit Unions now offer the Cultivate loan programme to their farmer members at 170 outlets across the country. Matt O’Keeffe discussed the programme with Joe Healy, chair of Collaborative Finance, which oversees the Cultivate Programme’s loan offerings
In 2023, loan applications increased to more than €50m, which is double that of the the previous year. Joe explains the rationale for its offering to the farming community: “As a farmer myself, I understand that farmers want flexibility, a simple format and a personal relationship with the lender. Surveys have confirmed that the Credit Union is trusted, with high customer satisfaction.”
A shade of green
A strategic appraisal of the Cultivate offering has led to the introduction of a new ‘green’ loan, Joe explains: “We have introduced the Greenify loan product to our farming-related loan book and it is being standardised for use across the Credit Union structure. It’s about encouraging farmers to improve their carbon efficiency on their farms, whether that’s solar panel installation, the use of low emission slurry spreading, cow collars, or for financing the costs of converting to organic production. Upgrading milking parlours is included, as are GPS systems for fertilising and spraying.”
But it is not just higher-end technologies that are eligible. Joe explains: “Farmers have also taken out loans to finance fencing off watercourses, or for solar-powered water troughs. They seek short-term finance to reseed fields with clover and multi-species swards as well as finance to cover the cost of soil sampling. The loans range from very small amounts to the maximum of €75,000 for an unsecured loan under the Cultivate programme. Last September, we announced increased loan ceilings up to €300,000 for loans that are secured.”
Demand driven
The Greenify loan facilities are driven by customer demand, Joe says: “No matter what sector of farming or the general economy you are involved in, there is an awareness that environmental protection has to be included in all developments and activities. The latest Environmental Protection Agency (EPA) report showed agricultural emissions down by 4.6 per cent. That’s proof that farmers are taking their environmental responsibilities seriously.
“Agriculture does get an unfair representation at times in relation to greenhouse gas emissions. We are an agricultural country. We don’t have heavy industry as other EU countries do so our emission figures are skewed in relation to agricultural activity. There is no dilution factor on account of this. The only proper measure to compare like with like is the carbon footprint per kilogramme of protein produced. When that’s considered, Irish milk and beef are up there with the best in the world."
Joe continues: “The latest figure I saw was 0.9kg of carbon per kilogramme of food protein produced. We can’t afford to rest on our laurels. There is a lot of technological innovation and adoption, as well as advice and training, helping us. The Credit Union Cultivate loan programme has a central role to play in assisting farmers in adopting these technologies. In many cases, the cost is ultimately neutral or positive. It is the initial cost that is a barrier to adoption. Once in place, these technologies deliver improved profitability, lower labour costs in many instances, and allow farmers to manage their farm enterprises more efficiently. It can be, as I said, low tech investments or higher end technologies that will deliver improvements.
"Reseeding with clover or multi-species can be just as effective as health-monitoring cow collars. The Credit Union representatives understand this and that’s why we have broadened the scope of our loan programmes to help finance that effective and practical greening aspect of farming.”