HeavyFinance takes a significant step forward in expanding its borderless marketplace, which connects small and medium-sized agribusinesses with the global investor community. Already providing individualized financing solutions in four countries, HeavyFinance enters the Poland market with the first loan already listed on the platform.
Fi-compass report of financial needs in the agriculture sector in Poland has identified a significant financing gap of between EUR 3.0 billion and EUR 6.2 billion. The issue particularly affects small farmers and their need for long-term loans. 98 percent of the gap is related to unmet needs of small and medium-sized farms.
The main providers of financing solutions are a large number of cooperative banks and a small number of commercial banks, both of which rely significantly on credit history, which young and promising farmers lack. As a result, young farmers represent a significant part of the gap, about 50-70 percent, which is twice the EU 24 average. Applicants often reject loan offers from traditional institutions due to non-acceptable lending conditions. Some farmers in Poland, according to the report, even did not apply for a loan due to a fear of rejection.
Demand for finance is driven by the need to enhance production standards in response to consumer demand to enable farmers to compete more successfully on international markets. To expand their exports and enter new markets, Polish farmers must adhere to a set of EU and international production standards, in terms of quality, size, food safety and packaging regulations. This requires additional investing in farm assets.
The demand for funding will rise as investments are made to enhance farms' resistance to environmental issues. Farmers in Poland have already been affected by the risks associated with climate change, like warmer winters, shorter springs, and summer heat waves. Farmers' yields are becoming more volatile as a result of this. The necessity of new farming methods is highlighted by the constantly changing situation. As a result, farmers must invest in new farming technologies, such as improved irrigation systems, and this thus increases the demand for financial solutions.
Shifting consumption patterns have also contributed to considerable changes in food production in recent years. Ecological farming is gaining traction, and more people are choosing gluten-free or lactose-free products or reducing their meat consumption. Changes in these trends have an impact on the prices farmers receive and the investments they make, influencing the financial gap.
The majority of investments made in Poland are for the modernization of machinery and other equipment. Working capital loans are also in high demand since they help firms stabilize cash flows and cover operating costs.
HeavyFinance specializes in providing such loans - the company has already facilitated loans for more than 300 farmers in Lithuania, Latvia, Bulgaria, and Portugal helping them modernize their farms. Since June 2020, the HeavyFinance investor community has contributed in improving the efficiency of 20.000 hectares of farmland. Now we are keen to open the Polish market to investors and significantly contribute while providing borrowers with customized financing offers tailored to their needs.
Those who opt to invest in the agriculture sector not only receive a solid annual return but also enable small farmers to grow and upgrade their operations. Modern technology solutions aid reduce carbon emissions while also increasing production levels to meet the growing global demand for food. You can contribute to the common goal of improving the agriculture sector by investing from 100 EUR. HeavyFinance will provide the opportunity to invest in EUR, thus eliminating the currency risk for our investors. Grow your investment portfolio while enabling farmers' growth.