This last part puts the whole scheme on one page: what happens in each year, who does it, and what money flows. It ends with a glossary of the scheme's abbreviations and a final self-test.
The short version
- Months 0 to 12: cluster, baseline survey, groups, registration and business plan.
- Year 2: first equity grant, clearances, half the business plan running, e-NAM.
- Years 3 and 4: share certificates, audited accounts and buyer agreements; management cost ends after year 3.
- Year 5: the full business plan done, three years of growth, and CBBO support ends.
Five Years on One Page
Each stage has its tasks and its money; by year five the FPO must stand on its own business.
| Period | What happens | Money |
|---|---|---|
| 0 to 6 months | Cluster approved by the D-MC; baseline survey; farmer groups formed | CBBO cost released in stages |
| 6 to 12 months | FPO registered with the minimum members; board with a woman director; business plan; bank account | Registration reimbursed up to ₹40,000; management cost begins |
| Year 2 | Licences and clearances; at least half the business plan running; training; e-NAM registration and trading | First equity grant tranche; first guaranteed loan if needed |
| Years 3 and 4 | Share certificates to members (year 3); audited accounts filed; agreements with buyers | Management cost ends after year 3; later equity tranches within 4 years of the first application |
| Year 5 | Audited accounts; full business plan carried out; three years of revenue growth; completion report | CBBO support ends; the FPO pays its own way |
Source: Operational Guidelines 7.4, 10.1, 11.4 and 12; see Parts 4 to 13
Your Checklist by Stage
Tick these off as the FPO moves through its five years; your ticks are saved in this browser.
The FPO's key steps
- Produce cluster approved and baseline survey done
- Members at or above the minimum (300 plains, 100 North-East and hills)
- FPO registered; board formed with at least one woman director
- Bank account opened; share register and minutes kept
- CEO and accountant appointed
- Business plan and 18-month budget ready
- Equity grant applied for; extra shares issued within 45 days
- Licences and clearances obtained; trading on e-NAM or another platform
- Accounts audited and filed every year
- Agreements with buyers in place
- Business income covers running costs before the end of year 3
- Data on the MIS portal kept up to date
Glossary
Every abbreviation used in the scheme, in one table.
| Short form | Meaning |
|---|---|
| AAP | Annual Action Plan of an implementing agency |
| AMI / ISAM | Agricultural Marketing Infrastructure sub-scheme of the Integrated Scheme for Agricultural Marketing |
| AMIF | Agri-Market Infrastructure Fund, in NABARD |
| BIRD | Bankers Institute of Rural Development, Lucknow |
| BoD | Board of Directors |
| CBBO | Cluster Based Business Organisation |
| CFC / CHC | Common Facility Centre / Custom Hiring Centre |
| CGF | Credit Guarantee Fund |
| DA&FW | Department of Agriculture and Farmers Welfare (earlier DAC&FW) |
| D-MC | District Level Monitoring Committee |
| DMI | Directorate of Marketing and Inspection |
| ELI | Eligible Lending Institution |
| e-NAM | National Agriculture Market, the electronic trading platform |
| FIG | Farmer Interest Group |
| FPO | Farmer Producer Organisation (company or cooperative) |
| IA | Implementing Agency |
| I&CSC | Investment and Claims Settlement Committee of NABARD or NCDC |
| JLG / SHG | Joint Liability Group / Self Help Group |
| LINAC | Laxmanrao Inamdar National Academy for Co-operative Research and Development, Gurugram |
| MIS / LMS | Management Information System / Learning Management System |
| NABARD | National Bank for Agriculture and Rural Development |
| NAFED | National Agricultural Cooperative Marketing Federation of India |
| NCDC | National Cooperative Development Corporation |
| N-PMAFSC | National Project Management Advisory and Fund Sanctioning Committee |
| NPMA | National Project Management Agency |
| ODOP | One District One Product |
| SFAC | Small Farmers' Agri-Business Consortium |
| SLCC | State Level Consultative Committee |
| UC | Utilisation Certificate |
What Makes an FPO Last
A real business plan, a professional CEO, members' own capital, more than one product, firm buyers and clean accounts.
A business plan that is used
Checked for the equity grant and at every CBBO milestone.
A professional CEO
Paid with support for three years, then from the FPO's own business.
Members' own capital
Matched by the equity grant and turned into shares.
More than one product or service
So that members have business with the FPO all year.
Firm buyers
Agreements with buyers, and trading on e-NAM or other platforms.
Clean accounts
Audited every year, so that banks and agencies can trust the FPO.
Check yourself
Tap an answer to see whether you are right, and why.
When does the management cost support end?
- After year 1
- After year 3
- After year 5
It covers the first three years; the FPO pays from year four.
What must the FPO do within 45 days of receiving the equity grant?
- Repay it
- Issue extra shares of the same value to members
- Open a new bank account
Clause 11.4 sets the 45-day deadline.
A bank lends ₹1.6 crore without collateral. What is the guarantee cover?
- ₹1.36 crore
- ₹1.2 crore
- ₹1.6 crore
Loans above ₹1 crore up to ₹2 crore get 75%: 75% of ₹1.6 crore is ₹1.2 crore.
Remember these things
- Year 1: cluster, members, registration, plan.
- Year 2: equity grant, clearances, e-NAM.
- Years 3 to 4: shares, audits, buyers; management cost ends after year 3.
- Year 5: the FPO stands on its own business.
Thank you for reading the whole handbook. Return to Part 1 for the map of all parts, or share this series with your board. For FPOs whose members are also certified under PGS-India, KrushiFlow submits farmer records to the PGS-India portal in bulk.