FPO in Agriculture: It’s Benefits and Registration

Table of Contents

• What is FPO?
• What is the purpose of FPO in agriculture?
• What are the Benefits of FPO?
• What are the challenges faced by FPOs?
• How do you Register for an FPO in India?
• What is the Difference between Cooperatives and FPOs?
• Government Schemes Supporting FPO in India

What is FPO?

FPO is an organization formed by a group of producers for farm or non-farm activities. The FPO full form in agriculture is Farmers' Producer Organization. In this organization, farmers collectively produce agricultural products. This organization aims to bring small and marginal producers together to enable the supply of quality inputs, such as heavy machinery, seeds, fertilizers, crop insurance, etc., to boost their agricultural needs. It benefits the member producers, and the producers share a portion of the profit. With a total budget of Rs. 6865 Crores in 2020, the government of India launched the Central Sector Scheme (CSS) for “Formation & Promotion” of 10,000 Farmer Producer Organizations (FPOs).

What is the Purpose of FPO in Agriculture?

The main purpose of an FPO in agriculture is to maximize the income of farmers, and to do so, they offer several services and activities. Some of these services are as follows:

• Supply of quality products like seeds, pesticides, fertilizers, etc., at the wholesale rate.
• Additional facilities like harvesters, cultivators, sprinklers, etc., are given for purchase and rent.
• Market details in produce, trends, demands, government regulations, and price fluctuations are shared with the members.
• Help achieve bigger export and market options.
• Better credit card options are available.
• FPO can accept deposits in the fixed or recurring deposit form and also disperse them as loans at a reasonable interest rate.

What are the Benefits of FPO?

FPOs in India offer a range of benefits to their members, covering almost every aspect of farming from inputs, technical services, to processing and marketing.

• Farmers can get quality production inputs like fertilizers, seeds, etc., at lower wholesale rates.
• FPO facilitates the process of value addition, like cleaning, grading, packing, and also farm-level processing facilities on a user charge basis at a cheaper rate.
• Farmers associated with FPO will get a market for their produce with better negotiation and better remunerative prices.
• With the formation of FPO, the agricultural sector of the country will reach new heights, and the income of the farmers will double within a short span of time.
• Farmers who are members of FPO get storage and transportation facilities.

What are the challenges faced by FPOs?

Despite the numerous benefits of FPOs in agriculture, FPOs face various challenges that hinder their efficiency. A few among them are as follows:

• Lack of awareness: Most farmers in India don't know about FPOs, and due to a lack of trust, they hesitate to become FPO members.
• Limited access to technology: This restricts FPOs' ability to adopt modern agricultural practices and improve efficiency.
• Regulatory issues: Complex compliance requirements for registration in FPO can create administrative burdens.
• Limited capacity: Most of the FPOs face restrictions related to limited technical expertise, human resources, and management skills, which hamper their functioning and sustainability.
• Access to finance: FPOs struggle to access funding from financial institutions.

How do you register for an FPO in India?

To get the benefits of FPO, you need to apply for it. Follow the steps below to get registered on the FPO portal:

Step 1: Visit the e-NAM website and click on the FPO registration form.

Step 2: Select your registration type and level.

Step 3: Put your personal details in the required fields, such as your name, gender, DOB, contact number, email ID, state, district, license number, etc.

Step 4: Enter your bank details properly, like IFSC code, account holder name, bank account, etc.

Step 5: Upload the cancelled cheque and a scanned copy of your ID proof.

Step 6: Fill in the Captcha and click on the submit button.

Step 7: And it’s done! You are now registered for the FPO on the portal.

What is the Difference between Cooperatives and FPOs?

Government Schemes Supporting FPO in India

The Government of India established the Central Sector Scheme (CSS) in 2020 to promote 10,000 FPOs. In addition, FPOs can avail assistance under various schemes such as:

• Agriculture Infrastructure Fund (AIF)
• Agricultural marketing infrastructure (AMI)
• Per Drop More Crop (PDMC) under RKVY
• Mission on Integrated Development of Horticulture (MIDH)
• National Beekeeping and Honey Mission (NBHM)
• National Bamboo Mission (NBM)
• National Food Security Mission (NFSM)
• Mission Organic Value Chain Development for the North-Eastern Region
• National Mission for Edible Oil- Palm Oil
• Sub Mission on Agriculture Mechanization (SMAM)

The government of India, along with its institutions like NABARD, SFAC, etc., support Farmer Produce Organizations (FPO) for long-term sustainability and better income for producers across the country. FPO, undoubtedly, is a great organization to tackle all the difficulties of the farmers, and it has yet to discover newer heights in the future as well.