PM-KISAN-FPO

✦Key Features

• Formation of 10,000 new FPOs by 2027-28, with a focus on a cluster-based approach.
• Financial assistance of up to Rs. 18.00 lakh per FPO for a period of 3 years.
• Provision for a credit guarantee facility up to Rs. 2 crore per FPO from eligible lending institutions.
• Emphasis on "One District One Product" for promoting specialization and better market linkages.
• Professional handholding support and training provided to FPOs for 5 years to ensure sustainability.
• Implemented through three agencies: Small Farmers' Agribusiness Consortium (SFAC), National Cooperative Development Corporation (NCDC), and National Bank for Agriculture and Rural Development (NABARD).

✓Eligibility Criteria

• Farmers willing to collectivize and form Farmer Producer Organizations.
• Existing FPOs needing support for expansion, strengthening, or diversification.
• Primarily targets small and marginal farmers who face challenges in market access and input procurement.

★Benefits

• Improved bargaining power for farmers through collective marketing and aggregation of produce.
• Access to better quality inputs (seeds, fertilizers, pesticides) at competitive prices.
• Enhanced market linkages leading to better price realization for their produce.
• Reduced post-harvest losses and opportunities for value addition through processing.
• Improved access to institutional credit, technical knowledge, and modern farming practices.

▶Application Process

• Identification of potential clusters for FPO formation by implementing agencies and Cluster Based Business Organizations (CBBOs).
• Mobilization and organization of farmers into FPOs by CBBOs.
• Registration of FPOs under relevant acts (e.g., Companies Act, Cooperative Societies Act).
• Preparation and submission of business plans and proposals to the respective implementing agency.
• Availing financial and technical support after approval and adherence to scheme guidelines.

₹ Budget Allocation

60000

Funding Ratio (Centre:State): Central Sector Scheme (100% Central Funding)

Historical Context

Announced in 2020 with the target to form and promote 10,000 new FPOs by 2027-28.

Sub-Schemes

Challenges

• Lack of professional management expertise among farmer members.
• Difficulty in accessing institutional credit without collateral.
• Limited access to modern storage and cold-chain infrastructure.
• Weak market linkages in remote hilly or tribal regions.

Reforms & Recommendations

• Integration of FPOs with ONDC (Open Network for Digital Commerce) to bypass traditional intermediaries.
• Dedicated training modules for FPO CEOs on financial literacy and global export standards.
• Lowering the minimum member threshold for extremely distressed districts.

Performance Statistics

SDG Linkages

Constitutional Backing

Technology Used

Success Stories

Key Takeaways

• Financial grant of up to INR 18 lakh per FPO for 3 years.
• Equity Grant of up to INR 15 lakh per FPO to match member contributions.
• Credit Guarantee Facility of up to INR 2 crore through NABARD/NCDC.
• Role of CBBOs in providing technical and management support.

Convergence Schemes

• Agriculture Infrastructure Fund (AIF)
• Mission for Integrated Development of Horticulture (MIDH)
• PM Formalization of Micro Food Processing Enterprises (PMFME)

Sector Tags