Lloyds and Wildfarmed launch fund to back regen farming

Farmers could receive private payments for improving soil health, biodiversity, water quality and carbon outcomes under a new fund aimed at scaling regenerative farming without taking land out of production.

Lloyds Banking Group and Wildfarmed have launched the Food & Nature Resilience Fund, which is designed to support farmers adopting regenerative practices on working farmland.

The fund will bring together money from banks, water companies, insurers and other businesses, with payments linked to verified environmental improvements.

Supporters say the approach could help farmers deliver nature recovery while continuing to produce food, and accelerate the transition of the UK’s 3 million hectares of arable farmland towards regenerative agriculture.

Lloyds, the UK’s largest agricultural lender, and Wildfarmed, the regenerative food and farming business, said the fund was aimed at tackling one of the biggest obstacles to changing farming systems: cost, with financial barriers cited by 92% of farmers as the main obstacle to adopting regenerative practices.

Severn Trent, Affinity Water and global commercial insurer AXA XL are among the first organisations committed to the scheme, with further partners expected to follow.

Supporters say banks, water companies and insurers have a shared interest in more resilient soils, cleaner water, lower environmental risk and stronger farmed landscapes.

The launch comes as farmers face growing pressure to improve environmental outcomes while keeping their businesses commercially viable.

Analysis by the Green Finance Institute, carried out with input from Defra and HM Treasury, has estimated that ecosystem decline could lead to a 12% hit to GDP over the next decade if nature degradation is not addressed.

Unlike many nature finance schemes, Lloyds and Wildfarmed said the fund does not require land to be taken out of food production. Instead, it aims to reward farmers for measurable improvements made while crops continue to be grown.

Wildfarmed said it works with research partners to analyse in-field data on soil health, biodiversity, water pollution and carbon.

The company pointed to research by the University of Bristol which recorded a 79% increase in insect biomass compared with conventionally farmed land in 2024. It also cited findings from research organisation NIAB, which recorded 15 Red List bird species in Wildfarmed fields in 2025.

Wildfarmed said the findings showed wildlife could return to actively farmed land where different practices and financial support are in place.

The fund also aims to support farmer wellbeing as part of the wider transition, with a recent survey finding that 91% of Wildfarmed growers reported a positive impact on their wellbeing and job satisfaction.

Ben Makowiecki, agriculture sustainability director at Lloyds Banking Group, said the bank had a responsibility to support farmers through the transition.

He said: “As the UK’s largest agricultural lender, we have a responsibility to support farmers during this transition.”

Mr Makowiecki said the fund would bring together businesses with an interest in resilient farming, healthy soils, clean water and stronger ecosystems.

He added that it could help “set in motion the pace of change needed to scale regenerative agriculture across the UK while creating a more reliable financial model for farmers”.

He said the partnership builds on Lloyds’ wider support for farmers, including its Agricultural Transition Finance proposition, its work with Soil Association Exchange and the Routes to Regen initiative.

Andy Cato, co-founder at Wildfarmed, said the food system had historically failed to properly value nature.

He said: “Historically, our food system has priced nature at zero.”

Mr Cato said the consequences could be seen in food price inflation and the fragility of ecosystems.

He added: “Nature and food production are too often seen in opposition, with payment schemes forcing farmers to choose one or the other.”

Mr Cato said a more resilient future depended on productive farmland that was also rich in nature.

He said: “For many years, it has been an ambition for farmers to be rewarded for delivering nature and resilience whilst growing food, not instead of it.”

He added that the partnership was “a big step forward” towards making that ambition possible at scale.

The test will be whether the fund can deliver reliable payments at a scale that makes regenerative changes commercially viable for farmers.