To support the farmers the Canara Bank has entered in to a partnership with the Small Farmers’ Agribusiness Consortium (SFAC). Through this partnership the bank will be providing collateral free lending to farmer producer organisations (FPOs).
SFAC is a society that works for the enhancement of the farmers. Along with this society the bank will work for the development of farmers and will extend the loan facility to FPOs. Mr. SS Bhat General Manager, Priority Credit and Financial Inclusion Wing, Canara Bank stated that they are trying to provide financial assistance to atleast 100 FPOs by this fiscal year. The bank will be providing the loan facility of up to Rs 1 crore under the Credit Guarantee Fund Scheme. Currently the bank is assisting 5 to 6 FPOs.
The Canara Bank is the first bank to partner with SFAC for extending finance to FPOs. In the coming years the govt. is planning to encourage the establishment of the FPOs.