To fund FPOs, Samunnati in co-lending pact with IndusInd Bank
Samunnati has entered into a co-lending agreement with IndusInd Bank to expand credit accessibility for farmer producer organisations (FPOs) across the country. This collaboration will provide ₹15 crore as an initial amount disbursed to farmers collectives. The primary aim is to ensure the self-sustainability and profitability of Farmer Collectives and their members, comprising mostly small-holder farmers, Samunnati said in a statement.
This strategic alliance will enable easy access to working capital to Samunnati’s growing network of 1,500 Farmer Collectives with a member base of 6 million farmers.
“Our collective goal with this alliance is to improve the flow of credit to the underserved agri community at an affordable cost, by leveraging the dual advantage of funds at a lower cost and Samunnati’s extensive FPO network,” said Anil Kumar SG, Founder and CEO, Samunnati.
In November 2020, the Reserve Bank of India (RBI) issued guidelines on Co-Lending Model between Scheduled Commercial Banks and NBFCs. IndusInd Bank is among the first scheduled commercial banks to participate in a co-lending program aimed at mainstreaming FPOs as an asset class.
Srinivas Bonam from IndusInd Bank said, “We see merit in FPOs as it is a best-fit model to help farmers pursue agriculture in a more effective and organised manner. This collaboration is in line with the Bank’s strategy to bring efficient and inclusive lending solutions. We look forward to successfully pilot Co-lending to FPO’s and take it to deeper levels of impact as we progress in this partnership”.