BARCLAYS BANK says trends in agricultural lending are changing as farm incomes become more diversified.

Marketing director Grant Phillips said 20-25% of its loans over the past year were now made up of its rural enterprise loan, which was introduced in 2003 to help farmers diversify.

It features a two-year initial repayment freeze to allow new enterprises to start generating funds.

The change in emphasis also meant bank managers were having to change, said Mr Phillips, who is putting all of Barclays‘ 96 agricultural managers through specialist training at Cranfield Business School.

“With almost half of farmers‘ incomes coming from non-agricultural activities, expertise in helping new ventures and business development is vital for our managers on top of their existing agricultural knowledge,” he said.

In 2004, the bank is predicting that the farming sector will generate £2.6bn from non-farming activities compared with a total income from farming of about £3bn.