Green loan

Green Loan is a type of financing that enables farmers to use the proceeds for projects contributing to the environment. For investors, Green Loans give an opportunity to indirectly contribute to the generation of high-quality soil carbon credits, which are later sold on the Voluntary Carbon Market and receive part of the proceeds from their sale.
-3,493,351 kg CO2e

LT0002389

Goal
40,500 €
Raised
40,500 €
100%
Return rate
20.3%
Rating
B+
Period
59
Time left
LTV
78%
Country
Lithuania
Loan purpose
Land purchase
Business information
Security measures
Loan history
Project owner Address
Xxxxxx Xxūxxx Xxxčxūxxx
Šxxxxų x., Xxxšxxxxxxų x. xxx.
header_1 Declared Owned
Farming land176.97 ha87.00 ha
20232022
Revenue 263,954.00 € 280,183.00 €
Net profit -7,809.00 € 59,911.00 €
Equity ratio 54.25% -
Project description
Documents
Payment schedule

About the farm

A family farm located in Kaišiadoriai district, established in 1998, specializes in the cultivation of various grains and forage crops, including wheat, barley, rapeseed, beans, clover, and ryegrass. Currently, the farmer declares 176.97 hectares of arable land, while the family collectively manages a total of 258.76 hectares, of which, according to the farmer, 190 hectares are privately owned.

The farm’s equipment includes two Deutz Fahr tractors, a Claas Lexion combine, an Amazone Primera DMC 6000-2C direct drill, an Amazone UX 5200 sprayer, a fertilizer spreader, and other necessary machinery to ensure efficient and high-quality agricultural operations. To strengthen operational capacity during the busy season, one additional worker is hired.

The loan will be used for the acquisition of additional land, aimed at supporting the farm's long-term growth and sustainability. Join this project and support the family farm’s successful expansion, contributing to its stability and productivity.

Main Terms

The principal will be repaid by the farmer in regular instalments over the span of 5 years in accordance with the repayment schedule.

109 hectares of land are included in the Green Loan program. It is estimated that a total of 1281 carbon certificates will be generated in 6 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;
(1) 60% of income received during the loan period;
(2) 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 40500 EUR * 12% * 6 year = 29160 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): 12,73% IRR*
Today's scenario (€35 per carbon certificate): 20,33% IRR*
Optimistic scenario (€100 per carbon certificate): 45,87% 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.

Project risks

Please note that investing in this project carries inherent risks, including the potential for the loss of profits and invested funds.

In the event that the Project Owner fails to fulfil their obligations, HeavyFinance will take all necessary measures to safeguard the interests of investors and utilise the provided collateral. However, the Platform Operator does not guarantee the complete fulfilment of the Project Owner’s obligations.

There is also the possibility that carbon certificates may not be generated due to various reasons, such as the actions of Heavy Finance UAB, the project owner, or external factors.

Due to changes in market conditions, measurement methodologies and other factors, the price of carbon certificates is subject to change.