340+ FPOs Cross Rs 10-Crore Sales Mark Under Centre’s Aggregation Scheme

Over 10,000 farmer producer organisations (FPOs) set up under the Centre’s special incentive scheme launched in FY21 have begun to scale rapidly, with more than 340 now reporting annual sales turnover above Rs 10 crore.

Nearly 1,100 FPOs have crossed Rs 1 crore in business, according to data gathered by the Union agriculture ministry.

The ministry said the performance gap is narrowing as more collectives professionalise operations and plug into organised markets.

Officials see the numbers as an early validation of the aggregation model for smallholders and intend to deepen support.

The high-growth FPOs have raised their market visibility by using government-backed digital rails such as the Open Network for Digital Commerce (ONDC), the electronic National Agriculture Market (e-NAM), and the Government e-Marketplace (GeM). These channels help them list products, discover prices, and transact with institutional buyers.

Several collectives formed in the last five years under the central sector scheme have also procured oilseeds, pulses, and grain at minimum support price (MSP) levels to build turnover and farmer trust.

“We are discussing ways to reward the high-performing FPOs so that other such organisations too get encouraged to boost their business prospects,” an official said.

Digital Reach Expands Beyond Mandis

More than 9,000 FPOs are already on ONDC. Over 200 collectives sell products on GeM. Sales of agri-produce have also begun to scale on private e-commerce channels such as Amazon and Flipkart, widening buyer reach beyond mandis.

Many groups use e-NAM to access inter-state trade flows and price signals that guide local aggregation. Together, these digital linkages lower marketing costs and expand demand for farmer-producer organisations.

Gujarat-based Babra Khedut Utpadak & Rupantar Sahakari Mandli shows the growth potential. The FPO has 1,465 members and has reported Rs 102 crore in sales by procuring groundnut and cotton at MSP from members on behalf of government agencies.

“We will be expanding our agri-inputs business in the current fiscal year to boost turnover further,” CEO Nirav Prakashbhai Mathukiya told FE.

The case highlights how assured procurement plus input retailing can push scale.

Active collectives now sell thousands of distinct agricultural and allied products across platforms. The catalogue includes about 200 varieties of rice along with pulses, millets, honey, mushrooms, spices, and a widening range of value-added products.

This widening portfolio improves margins and diversifies risk for farmer-producer organisations.

Support, Finance and Market Linkages

To strengthen commercial viability, governments are granting input licences and dealerships in seed, pesticide, and fertiliser to eligible FPOs. These rights let the groups run input supply businesses that generate cash flow and reduce member costs.

FPOs register under various statutes, including the Companies Act 2013, State Cooperative Societies Acts, or the Multi-State Cooperative Society Act, depending on local preference and scale ambitions. Many tap financial assistance through schemes such as the Agriculture Infrastructure Fund and Agricultural Marketing Infrastructure programme.

The agriculture ministry has launched a buyer-connection drive to link FPOs with organised demand. Through a series of webinars, officials have facilitated direct discussions with major commodity and food players including Olam International, Big Basket, Britannia, Flipkart, Country Delight, NCCF, and Mother Dairy.

Agencies such as GeM, APEDA, Nafed, and the Selco Foundation have also engaged to widen sourcing and capacity-building opportunities. The outreach aims to convert digital listings into sustained offtake.

Ongoing Support Through FY26

Financial assistance and marketing support to these farmer-owned collectives—where more than 3 million farmers hold equity—will continue until FY26. Most FPOs covered by the scheme have formed in the last couple of years, so policymakers expect further ramp-up as they mature. Officials plan to spotlight top performers to accelerate peer learning across districts.

The central scheme seeks to raise farmers’ collective bargaining power through local aggregation and to cut production costs by leveraging economies of scale. It provides up to Rs 18 lakh per FPO over three years for capacity building and operations. It also extends a matching equity grant of up to Rs 2,000 per farmer member, capped at Rs 15 lakh per collective, to strengthen balance sheets.

A credit guarantee facility covers loans of up to Rs 2 crore from eligible lenders. The programme further allows a project-level credit guarantee of up to Rs 2 crore per FPO to back expansion finance.

In addition, cluster-based business organisations receive up to Rs 25 lakh per FPO over five years to support product marketing and aggregation services.

The government has earmarked Rs 6,865 crore for the five-year rollout from FY21 through FY26. Officials say disbursements and performance reviews will guide any extension or scale-up beyond the current window.

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