June 30, 2026 - 215 views
Welsh farming businesses will be able to access affordable long-term finance to invest in sustainability, productivity and future growth through a new £5 million pilot loan scheme launching at the beginning of July.
The Sustainable Agriculture Loan Scheme (SALS) will offer eligible farms loans ranging from £25,001 to £1 million, with a fixed interest rate of 3%, repayment terms of up to 15 years and an initial repayment holiday to help businesses invest without immediate financial pressure.
Backed by the Welsh Government and delivered by the Development Bank of Wales, the one-year pilot is designed to help farmers overcome the high upfront costs of modernising their businesses at a time of rising energy prices, increasing production costs and growing pressure to reduce carbon emissions.
The funding can be used for a wide range of projects, including improving energy efficiency, installing renewable energy systems, upgrading farm buildings, improving waste management and investing in new machinery and equipment to boost productivity.
Announcing the scheme ahead of the NFU Sustainable Farming Conference, Cabinet Secretary for Rural Resilience and Sustainability, Llyr Gruffydd, said Welsh farmers were keen to invest in the future but often faced significant financial barriers.
He said: “Welsh farmers are ambitious and forward-thinking, but the up-front cost of investing in a more sustainable, resilient future can be a real barrier.
“This scheme reflects our commitment to support the agriculture sector in a way that underpins the long-term sustainability of farm businesses and promotes innovation and growth.”
The scheme will be managed by the Development Bank of Wales, whose Chief Executive Giles Thorley said access to affordable finance had long been a challenge for many rural businesses.
He said: “Rural Wales is full of ambitious businesses looking to invest, adapt and build long-term resilience, but access to the right kind of finance has often been a challenge.
“The Sustainable Agriculture Loan Scheme is designed to provide practical, affordable support for on-farm projects looking to support improvements in productivity, reduce energy costs and invest in more sustainable operations.
“This is about helping Welsh farms to invest for the long term while supporting the wider rural economy, local supply chains and the transition to lower-carbon agriculture.”
The pilot scheme forms part of the Welsh Government’s wider programme to support sustainable farming and follows significant changes to agricultural policy since the UK left the European Union. Ministers have increasingly shifted support away from direct subsidy payments towards investment in environmental improvements, climate resilience and the long-term viability of farm businesses.
The initiative also complements the proposed Sustainable Farming Scheme, which is expected to become the main framework for agricultural support in Wales, rewarding farmers for delivering environmental outcomes alongside food production.
To qualify, businesses must carry out agricultural or related activities on agricultural land in Wales and either farm at least three hectares of eligible land or demonstrate more than 550 standard labour hours each year. Seasonal repayment options are also being considered to better reflect the cashflow patterns of farming businesses.
The Welsh Government said the scheme supports its ambitions to strengthen rural communities, encourage innovation and help agriculture play its part in achieving Wales’ net zero targets.
