The funds raised will be used primarily to expand into Poland, as well as to scale the team and support growth in existing markets. To date, the startup has lent more than €14 million in Bulgaria, Latvia, Lithuania and Portugal and has helped more than 450 farmers – with a total of more than 45,000 hectares of land – transition to more sustainable farming practices.
HeavyFinance allows you to raise funds of up to €10,000 without additional collateral. All loans are administered fully online and include a tailored repayment schedule. The company aims to provide €500 million worth of agricultural loans by the end of 2024.
Financial assistance for farmers
Agriculture is the largest producer of greenhouse gas emissions after the energy sector, yet small and medium-sized farmers in the EU often find it difficult to access finance to automate processes and switch to more sustainable practices. Due to capital adequacy requirements and other factors affecting the unit economy, traditional financial institutions are often unable to provide small loans for agricultural activities. According to the European Commission’s Fi-Compass report, the total market gap in the European Union is between €19.8 billion and €46.6 billion.
HeavyFinance is stepping into this gap by providing short and medium-term financing solutions for the diverse needs of farms, including the purchase of machinery, land, or increasing working capital. Operating as a marketplace lending platform, HeavyFinance facilitates transactions between investors and farmers. HeavyFinance among other things allows the financing of the used agricultural machinery as collateral by accepting land or heavy equipment, which is not currently the market standard. Thanks to this, more farmers have the opportunity to get financing for the development of their business.
HeavyFinance also offers more favorable loan terms for farmers transitioning to more sustainable farming practices, including purchasing less polluting equipment, increasing soil carbon sequestration and zero-tillage projects. The company is placing greater emphasis on sustainability in all of its future operations, planning to help farmers generate carbon credits that can later be sold. Currently, more than 65% of the loans are dedicated to helping farms transition to more sustainable farming practices.
Laimonas Noreika, CEO of HeavyFinance, said: – Agriculture is a key battleground in the fight against climate change and the whole sector is being rapidly transformed by technology. The young generation of farmers is already waiting to move to new agricultural models that are more nature-friendly. Unfortunately, until now, access to finance has been a major barrier. There is a significant funding gap for small and medium-sized farms in Europe and a strong investor appetite for high-yield investment products. HeavyFinance is here to meet both needs.
Wojciech Drewczynski of Black Pearls VC said: – We are very excited to help HeavyFinance on its way to becoming a universal funding platform for European farmers. With an experienced team that has developed many successful startups, HeavyFinance is well positioned to enter new markets and solve a huge problem for farmers. A solid product, deep sector and market knowledge, and exceptional customer service provide a strong foundation to build a trusted brand in the farming community.
– Farmers are a large group of diverse customers who face many challenges, including the environmental transition and the shift to more sustainable production methods. Yet they are still severely underserved by banks and financial service providers. We firmly believe that farmers, like many other groups, are moving very quickly into the online world and need seamless solutions to support their business, such as HeavyFinance,” said Maciej Balsewicz of bValue VC.