Ahead of its launch next week, this UK-based agricultural bank raises €22.1M to help British farmers

UK-based Wheatsheaf Group is an international investor in food and agriculture businesses. The company works with the purpose to rethink and reshape the way food is grown, produced, distributed and consumed. It is claimed to be one of the largest and longest established investment teams in the agritech sector.

Invests in first dedicated agricultural bank

Now, Wheatsheaf Group announced that it has invested in Oxbury Bank – UK’s first dedicated agricultural bank in nearly 100 years. This investment is meant to help British farms become more sustainable and productive. Talking about the investment, the Series C funding round in Oxbury Bank is led by Wheatsheaf Group that has pumped in £20M (nearly €22.1M) along with participation from Oxbury’s founding shareholders including Frontier Agriculture and Hutchison Group that are major agricultural distributors.

“UK farmers need the support of a lender that understands farming challenges and opportunities and that can move quickly to support them. Our investment aims to strengthen Oxbury’s ability to support UK agriculture, enabling British farms to manage their finances more efficiently and effectively, helping them to become more productive and sustainable,” says Anthony James, Executive Director, Wheatsheaf Group.

Lending services for farms

Chester-based Oxbury Bank will open its doors for business sometime this month. According to the company, it will provide radically improved lending services for farms and offer retail savers the chance to support British farming and back innovative climate change projects.

Founded by leading farmers and agricultural distributors, bankers and tech experts from the finance and agriculture industries, Oxbury Bank received its banking licence back in January 2020. It offers a slew of lending and saving products for agricultural businesses that cannot get funds from mainstream lenders and banks.

Oxbury targets an 8 per cent share of all farm lending within five years of launch, in a market where 70 per cent of lending is still controlled by the big four banks.

James Farrar, Oxbury Bank CEO, says, “We’re launching Oxbury at a time of critical importance to UK agriculture. Oxbury is the only UK based bank that has its thinking, expertise and empathy exclusively focussed on the agricultural market and the needs of those farmers, as well as offering British savers the opportunity to support the cornerstone sector of the UK economy and the transition to a low-carbon future.”

Innovative product portfolio

The bank’s product, Oxbury Farm Credit provides flexibility to farms and lets them manage their short-term financial needs. The bank also helps British farmers by providing consumers the opportunity to use their savings to fund a thriving farming community and sustainability projects including Oxbury Forest Saver, the world’s first-ever carbon-offset savings account.

With Oxbury Farm Credit, the company solves the problem faced by farm businesses in funding their raw materials several months or years before receiving income from the sale of produced goods. It is estimated that farmers spend over £9B a year on purchasing raw materials to support production. However, traditional banks have reduced short-term working capital funding to farmers by over 25 per cent in the past decade.

The company claims that every pound saved with Oxbury will be used for lending to farms in the UK.