Small Farmer’s Agribusiness Consortium – Venture Capital Assistance
Promoting Agri-Business by encouraging institutional and private sector investments and linkages to ensure the empowerment of all farmers in the country. To link small farmers to technology as well as to the markets in association with private, corporate or cooperative sector and if necessary, by providing backward and forward linkages. SFAC is organized by the DAC. It was Established in the year of 1994. SFAC is a Society established by DAC, GOI, chaired by Hon. Agriculture Minister. RBI, NABARD, PSBs are original promoters of SFAC. Venture Capital Assistance Scheme is a Central Sector Scheme for agri-business development implemented by SFAC. The scheme provides financial assistance to agriculture entrepreneurs by participating in their equity component as interest free loan payable after repayment of term loan. The VCA Scheme is implemented during the XII Plan Period (2012-2017)
- SFAC would provide Venture Capital to qualifying projects on the recommendations of the Notified Financial Institution financing the project. This venture capital will be repayable back to SFAC after the repayment of term loan of lending Notified Financial Institution as per original repayment schedule or earlier.
- To facilitate setting up of agribusiness ventures in close association with banks & the projects should be accepted by banks/ financial institutions for grant of term loan.
- To catalyses private investment in setting up agribusiness projects and thereby providing an assured market to producers, for increasing rural income and employment.
- To strengthen backward linkages of agribusiness projects with producers.
- The projects should be in agriculture or allied sector or related to agricultural services. Poultry and Dairy are also covered under the scheme..
- The project should encourage farmers to diversify into high value crops.
SFAC provides interest –free venture capital to agribusiness projects by way of soft loan to supplement the financial gap worked out by the sanctioning authority of term loans under means of finance, with respect to the cost of the project. (Other than Hilly and North-Eastern states and backward Districts). The quantum of SFAC Venture Capital Assistance will be the lower of the following:
- 26% of the promoter’s equity (or)
- Rs. 50.00 lakhs.
Provided that for projects located in North-Eastern Region, Hilly States (Uttarakhand, Himachal Pradesh, Jammu & Kashmir) and in all cases in any part of the country where the project is promoted by a registered Farmer Producers Organisation, the quantum of venture capital will be the lowest of the following: 40% of the promoter’s equity Rs. 50.00 lakhs.
Eligible cost of the Project:
Minimum Rs.15.00 lakh (Rs.10.00 lakh for Hilly and North-Eastern states and backward districts). Maximum up to Rs. 500.00 lakhs. However, projects valuing Rs. 10.00 lakhs and above, proposed to be located in backward districts as notified by Planning Commission, hilly and North-Eastern States could also be considered for PDF and VCA. The Executive Committee of SFAC will have the power to consider projects for higher Venture Capital Assistance provided:Provision for higher VCA has been appraised and approved by sanctioning authority of term loan subject to maximum of Rs. 300.00 lakhs. Total cost of the project not more than Rs. 1000.00 lakhs. Projects are located in the North Eastern Region (NER) and other difficult pre- identified districts declared backward by Planning Commission’s Backward Regions Grant Fund Scheme.
Assistance under the scheme is available to: Individuals, Farmers, Farmers Producers companies / Organisations, Partnership/Proprietary, Self – help groups, Companies, Agripreneurs, Units in Agri- Export Zones, Agriculture graduates individually or in group.
Eligible Primary Lending Institutions (Banks):
SFAC will implements the scheme in close association with Nationalized banks, SBI and its subsidiaries, IDBI, SIDBI, NABARD, NCDC, NEDFi, Exim Bank, RRBs and State Financial Corporations. They are like..
Bank of Baroda
Bank of India
Bank of Maharashtra
Central Bank of India
Indian Overseas Bank
Punjab & Sind Bank
Punjab National Bank
State Bank of Bikaner & Jaipur
State Bank of Hyderabad
State Bank Of India
|State Bank of Mysore
State Bank of Patiala State Bank of Sind Bank State Bank of Travancore Syndicate Bank
Union Bank of India
United Bank of India
List of Eligible Items for SFAC
Coconut shell charcoal
Fruit & Veg processing
Milk Procurement & Chilling
|Patchouli (Medicinal plant) Pickles/ Sauces / Jam Rice / Poha Mill
Potato Chips Poultry
Pulse Processing Unit
Sago (Tapioca Roots)
Sweet / Baby corn