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Different Models of Financing Small Farmers’ Agricultural Value Chains

In: Financing Agriculture Value Chains in India

Author

Listed:
  • K. V. Gouri

    (Basix Consulting and Technology Services Limited)

  • Vijay Mahajan

    (Basix Social Enterprise Group)

Abstract

The concept of agricultural value chain covers full range of activities and participants involved in moving agricultural products from farmers’ fields to consumers’ tables. (Farm gate to food plate). Value chain participation by farmers can be merely as suppliers, in which case they do not get any share of the further value added. If, however, the farmers are aggregated into large numbers, and enabled to own parts of the value chain, they can benefit from the downstream value addition as well. For this, they need to invest capital and the value chain has to be integrated. To create an effective agricultural value chain, financing of agricultural value chains is a very important need. Agricultural value chain finance is a structured way of financing agriculture that links stakeholders operating within the value chains and lending institutions, and reduces the risks that are commonly associated with traditional agricultural financing. This paper shows number of approaches that are emerging in financing the building of agricultural value chains and emphasizes on need for many more innovative approaches, particularly to support small farmers to become an integral part of profitable value chains.

Suggested Citation

  • K. V. Gouri & Vijay Mahajan, 2017. "Different Models of Financing Small Farmers’ Agricultural Value Chains," India Studies in Business and Economics, in: Gyanendra Mani & P.K. Joshi & M.V. Ashok (ed.), Financing Agriculture Value Chains in India, pages 33-53, Springer.
    • Handle: RePEc:spr:isbchp:978-981-10-5957-5_3
    DOI: 10.1007/978-981-10-5957-5_3
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