Why Form an FPO?

  • Buy cheaper: Bulk purchase of seed, fertilizer and pesticide cuts input cost 10-20%.
  • Sell higher: Aggregated produce attracts bigger buyers, exporters and processors who pay more than the local mandi.
  • Access capital: Government equity grants, credit guarantee, and 3% interest loans under the Agriculture Infrastructure Fund.
  • Own the value chain: Run custom hiring centres, warehouses, cold storage and processing units as a member-owned business.

How to Register an FPO - Steps

  1. Mobilise minimum 300 farmers (100 in hilly/NE areas).
  2. Choose a Cluster-Based Business Organisation (CBBO) / implementing agency (NABARD, SFAC, NCDC).
  3. Register as a Producer Company under the Companies Act.
  4. Open a bank account, raise member equity, apply for the matching equity grant.
  5. Draft a business plan and apply for working capital under the credit guarantee scheme.
💡 Tip: Combine FPO status with cold storage subsidy and the Agriculture Infrastructure Fund to build member-owned post-harvest infrastructure at minimal cost.