Small Farmer’s Agribusiness Consortium – Venture Capital Assistance
Introduction:
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)
Objective:
- 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.
The Scheme:
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.
Eligibility Criteria:
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..
| Allahabad Bank
Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank |
IDBI
Indian Bank Indian Overseas Bank OBC 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 UCO Bank Union Bank of India United Bank of India Vijaya Bank |
List of Eligible Items for SFAC
| Aqua Agriculture
Banana Ripening Bio fuel Cashew Cattle Feed Coconut shell charcoal Cotton Coconut Cold storage Dairy processing Edible oil Fisheries Food processing Fruit & Veg processing |
Ginger
Groundnut Herbal Extracts Honey Lemon grass Mango Papad Milk Procurement & Chilling Misc. Spices Mushroom Mustard Oil Onion Dehydration Organic compost Paddy |
Patchouli (Medicinal plant) Pickles/ Sauces / Jam Rice / Poha Mill
Potato Chips Poultry Layer Farm Pulse Processing Unit Raisin Sago (Tapioca Roots) Seed Processing Stevia Sugar Beet Sweet / Baby corn Vermi Compost |