Agriculture technology firm Farmers Business Network and the nonprofit Environmental Defense Fund are trying to incentivize farmers to adopt more sustainable growing methods.

The two are starting a US$25 million pilot fund that rewards farmers who meet soil health standards and use nitrogen fertilizer efficiently. Through the fund, 30 to 40 farmers will receive one-year lines of credit of up to US$5 million with lower rates and fees.

Farmers have been under increasing pressure to adopt more sustainable practices due to the impacts of climate change. Climate activists have been  pushing for years, for example, to reduce fertilizer use or change the way it’s produced. Runoff from farms can enter rivers and streams and cause problems like coastal dead zones, and synthetic nitrogen fertilizers require huge amounts of energy to produce. But the question has always been how to make sustainable farming make sense financially for growers.

“What we’ve seen is as farmers improve the health of their soil, they’re improving organic matter, then they don’t need as much” fertilizer and other inputs, Maggie Monast, senior director of climate-smart agriculture at EDF, said in an interview. That helps farmers’ bottom lines.

The fund is enrolling farmers growing a combination of corn, soybeans and wheat. FBN hopes to scale the fund to US$500 million over three years. Farmers will be able to use the company’s platform to help them decide what practices will work for their farm.

“I haven’t met a grower who doesn’t live and die by soil health,” Steele Lorenz, FBN’s head of sustainable business, said in an interview.