European climate finance company InSoil has secured a €120 million senior secured credit facility from Pollen Street Capital, in what the company described as one of the largest private credit commitments to sustainable agriculture lending in Europe to date. This is InSoil’s third major capital raise in a year, after a €50m EIF-backed fund and a carbon-credit financing partnership.
The transaction highlights a shift in agricultural finance as institutional investors increasingly seek exposure to climate-related opportunities and natural capital, moving beyond more established sectors such as renewable energy and infrastructure.
Founded in 2013, London-based Pollen Street manages more than €8bn in assets across private equity and credit strategies on behalf of pension funds, insurers, sovereign wealth funds, banks, foundations and family offices. The firm’s backing of InSoil signals confidence that financing regenerative agriculture can deliver both commercial returns and measurable environmental outcomes.
The underlying loans are supported by a guarantee from the European Investment Fund (EIF) under the InvestEU programme, providing an additional layer of protection for investors while helping channel capital towards Europe’s farm sector.
Addressing a longstanding funding gap
InSoil said the facility will expand its ability to provide mid-term debt financing to small and medium-sized agricultural businesses adopting sustainable farming practices, including no-till cultivation, cover cropping, diversified crop rotations and reduced use of synthetic fertilisers.
The company argues that this segment has historically been underserved by traditional lenders. According to figures cited by InSoil from the European Investment Bank, European agricultural SMEs face an estimated annual financing gap of €62bn.
“European agriculture is entering a new investment cycle,” said Laimonas Noreika, CEO and founder of InSoil.
“Farmers need capital to modernise equipment, improve soil health and build more resilient businesses, but specialised financing has been scarce. This facility lets us meet that demand at scale and shows that sustainable agriculture has become an investable asset class for institutional capital.”
Three groups battle for Europe’s sustainable finance market
The InSoil-Pollen Street deal also reflects a broader transformation underway in agricultural lending.
Increasingly, three groups are competing to finance Europe’s sustainability transition.
The first consists of established agricultural banks, many of which are introducing sustainability-linked products and incentives for farmers who can demonstrate environmental improvements.
The second includes specialist agricultural finance providers such as InSoil, which combine sector-specific expertise with alternative underwriting models designed around regenerative farming systems.
The third, and potentially most disruptive, group is made up of private credit funds, asset managers and institutional investors seeking exposure to climate and natural-capital themes.
The latest deal suggests this third cohort is becoming increasingly influential, with investors now committing large pools of debt capital directly to farm finance platforms capable of deploying money at scale into sustainable production systems.
Data-driven lending model
InSoil believes its use of environmental data helps differentiate it from conventional lenders.
Since launching in 2020, the company has financed more than 3,500 agricultural SMEs investing in sustainable farming practices across Europe.
The lender has also collected more than 15,000 soil samples from participating farms, creating one of the largest proprietary soil carbon datasets in the region. The information supports both the company’s credit underwriting process and its climate impact measurement activities.
InSoil also issues soil carbon credits under the Verified Carbon Standard, positioning itself as both an agricultural lender and a climate finance platform.
For investors such as Pollen Street, this combination of farm-level relationships, environmental data and government-backed guarantees reduces some of the risks traditionally associated with agricultural lending and show that regenerative agriculture can demonstrate consistent economic returns for farmers and lenders.
“InSoil has built a genuinely differentiated position in European agricultural finance, combining deep relationships, rigorous credit underwriting and a strong track record,” said Paul Varty, Investment Director at Pollen Street.
“Backed by the EIF guarantee, the facility offers compelling structural protection.”
