Green loan

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About the farm

In 2013, a crop farm was established in Ukmergė district, growing cereals such as oats, wheat, buckwheat, peas, etc. The cultivated area is 160,22 ha of which 29,86 ha are owned. The land is cultivated using no-till farming technology.

The farm's fleet consists of two tractors, a combine harvester and other tillage implements such as a harrow, a sowing machine, a fertilizer spreader, a sprayer, a trailer for transporting cereals, etc.

The farmer has two loans on the HeavyFinance platform, which are being paid without reproach, but this year's hailstorm and heavy rains have destroyed 50 per cent of the harvest, so the farmer has applied for a loan to refinance the existing loans, and is pledging 6 pieces of land as collateral.

Main Terms

The principal will be repaid by the farmer in regular instalments over the span of 4 years in accordance with the repayment schedule.

165 hectares of land are included in the Green Loan program. It is estimated that a total of 1765 carbon certificates will be generated in 5 years (based on a conservative estimation). Consequently, investors will receive below indicated portion of sales proceeds from every carbon certificate generated from the land of the project owner involved in the program;
60% of income received during the loan period;
40% of income received for the following year after the loan period.

It is expected that the first carbon certificates will be generated and sold in the second quarter of 2025. The exact return will depend on the amount of sequestered CO2 levels and the sale price of the carbon certificates.

If the project owner (farmer) withdraws from the Carbon Credits Agreement and does not intend to follow the agreement on the carbon revenue split with investors, the project owner will be obliged to repay the entire loan as well as pay the penalty, calculated by multiplying the interest rate by the entire loan amount and period equal to the duration of the loan agreement plus 12 (twelve) months.
Investors of this loan would receive a penalty of 79000 EUR * 12% * 5 year = 47400 EUR. This penalty can be reduced by the return earned by investors from the carbon credits generated

If the project fails to be delivered successfully through no fault of the farmer, the farmer commits to paying investors a minimum interest rate of EURIBOR 6M + 1.5%. This commitment applies in situations such as the lack of market demand for selling carbon credits, among others.

Annualized return forecast

Conservative scenario (€20 per carbon certificate): 12,7% IRR*
Today's scenario (€35 per carbon certificate): 21,1% IRR*
Optimistic scenario (€100 per carbon certificate): 52,2% IRR*
Read more about the return scenarios in the document section

*The internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. Learn more about it

Keep in mind that the return forecast is an estimation and does not guarantee you the returns mentioned above."