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FPO in Agriculture: It’s Benefits and Registration

Updated on 10th December, 2024, By Abhijeet Warak

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FPO in Agriculture: It’s Benefits and Registration

Agriculture is the major source of livelihood and income in India, as more than half of the population is engaged in it. Farmers faces many challenges in their day-to-day agricultural tasks. Lack of land holding capacity is the main reason why small-scale farmers are unable to invest in high-end machinery, so a legal entity named Farmers Producer Organization (FPO) in agriculture is formed by primary producers, viz. farmers, milk producers, fishermen, weavers, rural artisans, and craftsmen. In this blog, we will understand the concept of FPO, its benefits, the schemes that support this organization and the complete registration process. So, without wasting more time, let’s dive right into the blog.

What is FPO?

Farmers Producer Organization (FPO) is an organization formed by a group of producers either for farm or non-farm activities. In this organization, farmers collectively produce agricultural products. This organization aims to ensure better income for the producers through an organization of their own and to bring small and marginal producers to enable the supply of quality inputs such as heavy machinery, seeds, fertilizers, crop insurance, etc., to boost their agricultural needs. It works for the benefit of the member producers, and the producers share a part of the profit. With a total budget of INR 6865 Crores in 2020, the government of India launched the Central Sector Scheme for “Formation and Promotion of 10,000 Farmer Producer Organizations (FPOs)” to enable farmers to enhance their bargaining power, leverage economies of scale, reduction in cost of production and enhancing farmers’ incomes through aggregation of their agricultural produce, thus playing a major role towards sustainable incomes.

What are the Benefits of FPO?

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 at a user charge basis on 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 lead to 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.

How do you Register for an FPO in India?

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

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

Step 2: Select your registration type and level.

Step 3: Fill in your personal details such as 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 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?

Cooperatives	FPOs
The members are only individuals and cooperatives.	Any individual, farmer, producer, or group can become a member of FPO.
It works only on a single objective.	There are many objectives in FPO.
The cooperatives are registered with the Registrar of Cooperatives under the Cooperative Societies Act or mutually aided Cooperative Societies Act.	The FPO is registered with the Registrar of Companies under section IX A of the Indian Companies Act, 1956.
Limited dividends on the profit.	Equal profit rights to all the members of FPO.
The reserves are created only when the cooperative is in profit.	Reserves are created mandatorily every year.
The cooperative has restricted borrowing power.	It has more freedom and alternatives in terms of borrowing power.

Government Schemes Supporting FPO in India

Agriculture Infrastructure Fund (AIF)
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 North Eastern Region (MOVCDNER)
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.

Published By

Abhijeet Warak

With over 2 years of experience, Abhijeet is a seasoned tractor and implement expert with an M.Tech (Agri) (FMP) from Dr Balasaheb Sawant Konkan Krishi Vidyapeeth. His knowledge is rooted in practical experience and academic excellence.