Vrutti, part of the Catalyst Platform, has launched FPO Shakti, a blended stage-based financing facility aimed at helping Farmer Producer Organisations (FPOs) access timely and appropriate capital.
Supported by HSBC India and managed by Friends of Women’s World Banking (FWWB) India, the initiative seeks to close the long-standing credit gap that prevents most FPOs from growing beyond early incubation.
India has more than 44,000 registered FPOs, but fewer than one-third can secure formal credit. Many stagnate after an initial growth phase because collateral-heavy loans and strict eligibility norms keep them outside the formal financial system, creating a “missing middle” that weakens rural value chains and restricts smallholder income growth.
FPO Shakti addresses this challenge through a blended finance approach that brings financial institutions, catalytic capital providers, buyers and technical assistance partners into one operational model. The facility will support an initial cohort of 15 early-growth FPOs, with plans to scale to over 100 organisations.
The model combines revolving funds, guarantees, revenue-linked finance and digital record-keeping systems with tailored technical assistance. Over a 24-month structured acceleration journey, FPOs will strengthen governance, financial discipline, market linkages and supply-chain systems, enabling them to become investment-ready and market-ready.
Aloka Majumdar, MD and Head of Sustainability, HSBC India, said, “FPOs play a crucial role in improving the socio-economic well-being of farmers. However, a vast majority of FPOs face the challenge of accessing credit as they are either too large for micro-credit or too risky for mainstream finance. A structured intervention that builds capacity of FPOs, strengthens governance and enhances business capability is the need of the hour. The facility will unlock a pipeline of investment-ready FPOs by reducing credit barriers, strengthening governance and positioning them for sustainable market participation.”
Speaking on the launch, Raghini Badhrinarayanan, CEO, Vrutti, said “This Facility marks a shift from short-term project support to long-term institutional strengthening. FPOs need patient capital and the right scaffolding. With this model, we are creating the pathway for FPOs to function like enterprises while staying rooted in community ownership and farmer value.”
Published on December 5, 2025
