10,000 farmer producer organizations (FPOs) formed under Government’s Flagship Scheme

Posted 01 Mar 2025

2 min read

FPOs have been formed under central sector scheme (Scheme for Formation and Promotion of 10,000 FPOs) which was launched on February 29th 2020.

About Scheme for Formation and Promotion of 10,000 FPOs

Ministry: Ministry of Agriculture & Farmers Welfare
Focus on aspirational districts: Ensuring at least one FPO in each block of these districts with One District One Product (ODOP) cluster model.
Provides handholding support: For a period of five years to each new FPO formed, and financial assistance to tune of Rs.18 lakhs to each FPO towards management cost for 3 years.
Ensuring institutional credit accessibility to FPOs: By credit guarantee facility upto Rs. 2 crore of project loan per FPO from eligible lending institution.

Market Advantages: Minimized post-harvest losses through joint storage and value addition facilities.
Financial benefits: Help achieve Better price realization and reduced distress sales.
Technological and Knowledge Access: Access to modern technology, extension services etc.
Ease in communication: Helps in price updates, market trends, and advisory services.

Credit guarantee fund for FPOs: Provides credit guarantee cover to financial institutions for extending loans to FPOs.
ONDC platform: 5,000 FPOs are now on boarded on Open Network for Digital Commerce (ONDC).
Converting 10,000 FPOs into Common Service Centers (CSCs): To provide citizen-centric services via the Digital Seva Portal.

FPO is one type of Producer Organization (PO) where the members are usually farmers.
- PO is a legal entity formed by primary producers, viz. farmers, milk producers, craftsmen etc.
Purpose: Leveraging collectives through economies of scale in production and marketing of agricultural and allied sectors.
Registration: FPOs are collectives of farmers and producers registered under Part IXA of the Companies Act or the Co-operative Societies Act of respective states.