Scheme for Formation and Promotion

 10,000 Farmer Producer Organizations (FPOs) Established Under Government’s Flagship Scheme

The government has successfully formed 10,000 Farmer Producer Organizations (FPOs) through the central sector scheme, Scheme for Formation and Promotion of 10,000 FPOs, which was launched on February 29, 2020.

About the Scheme for Formation and Promotion of 10,000 FPOs:

• Ministry: Ministry of Agriculture & Farmers Welfare
• Focus on Aspirational Districts: The scheme aims to establish at least one FPO in every block of these districts, with a focus on the One District One Product (ODOP) cluster model.
• Handholding Support: Each newly formed FPO receives support for five years, along with financial assistance of up to Rs. 18 lakhs for management costs over a period of three years.
• Institutional Credit Access: The scheme provides FPOs with a credit guarantee facility of up to Rs. 2 crore per FPO for project loans from eligible lending institutions.

Advantages of the Scheme:

• Market Benefits: Reduces post-harvest losses by providing joint storage and value addition facilities.
• Financial Gains: Helps achieve better price realization and reduces distress sales.
• Technology and Knowledge Access: Provides access to modern technologies, extension services, and other agricultural innovations.
• Improved Communication: Facilitates access to price updates, market trends, and advisory services.

Key Initiatives Under the Scheme:

• Credit Guarantee Fund for FPOs: This fund offers a credit guarantee cover to financial institutions for extending loans to FPOs.
• ONDC Platform: Currently, 5,000 FPOs have been onboarded onto the Open Network for Digital Commerce (ONDC).
• Conversion of FPOs into Common Service Centers (CSCs): The scheme aims to convert 10,000 FPOs into CSCs, enabling them to provide citizen-centric services via the Digital Seva Portal.

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