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The new partnership with major bank and agri-tech Geora is expected to help Australian farmers report on their sustainability practices.
The partnership with Geora will allow farmers to support their reporting covenant under NAB’s Agri Green Loan by utilising Geora’s blockchain technology that integrates the company’s existing sustainability providers.
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For example, using the technology will allow a farming company, such as a cattle producer, to track its sustainability activities by storing information using blockchain to highlight its credentials to customers and in green lending.
NAB said this will create a “standardised and clear record of the environmental impact” and will assist farmers in reducing their emissions by providing more transparency.
As farmers are being asked to report on their sustainability efforts, NAB’s chief innovation officer, Howard Silby, said this initiative will demonstrate how blockchain technology can help in the finance industry.
“We believe that elements of the future of finance will be blockchain enabled and that the technology also has the potential to assist with how we track and audit our ESG-linked financial products,” Mr Silby said.
“Digitising and building trust through a transparent and consistent reporting structure will make this process easier and saves duplication for farmers and their entire supply chain.”
The standardised reporting process can be aggregated across a portfolio of multiple loans and
will “underpin the green credentials of [NAB’s] green loan products”, he added.
It comes as NAB moves to expand its Agri Green Loan product offering and continues to explore how technology can help with cost efficiencies for customers investing in driving quality ‘green’ outcomes.
Geora’s chief executive and co-founder, Bridie Ohlsson, launched the agri-tech company in 2019 and was thrilled to see the collaboration between traditional banking and the start-up industry, having already worked with CBH Group and Rabobank.
“The process of building more sustainable agriculture involves moving trust from the physical world to secure digital environments,” Ms Ohlsson said.
“NAB is a core part of the producer’s trust network in Australian agriculture, and that’s one of the reasons we are so excited to be working together.”
Creation of a stablecoin
As borrowers seek funds for greener business models, the bank’s green loan portfolio and transparent reporting will support its transition towards a low-carbon economy.
NAB has recently announced the creation of a stablecoin pegged to the Australian dollar, called the AUDN.
“We believe that elements of the future of finance will be blockchain-enabled because it has the potential to help deliver instantaneous, transparent, and inclusive financial outcomes for customers as our economy becomes increasingly digitised,” Mr Silby said.
“This is a new era of transparency which is essential if we are to direct funds at scale to the transition to a green economy.”
[Related: Thinking green why demand for green loans is rising]
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