National Bank of Agriculture and Rural Development (NABARD) and Small Farmers Agribusiness Consortium (SFAC) on 4 July 2014 signed a Memorandum of Understanding (MoU) for the development of Small Farm Producers.
The MoU seeks to bring the two institutions in close coordination for implementing schemes for promotion of Producer Organisations (POs).
The SFAC is implementing a scheme of the Government of India whereby the Producers Organisations are given equity support and the financing banks are given credit guarantee cover to enable formation of Producer Organisations.
NABARD will proactively leverage the benefits of the equity grant and credit guarantee fund for Follow on Public Offers (FPO) set up by SFAC to ensure that finance for producer company flows smoothly.
NABARD will actively collaborate with the SFAC at national, state and district level by participating in the Food Security Mission. NABARD informed that it has a fund of 50 crore rupees for supporting producer organisations.
Follow on Public Offers (FPO)
FPO is a process by which a company, which is already listed on an exchange, issues new shares to the investors or the existing shareholders, usually the promoters. FPO is used by companies to diversify their equity base.
Who: NABARD and SFAC
What: signed a MoU
When: 4 July 2014