What is Agriculture Finance?
Agriculture finance refers to a specific range of financial services for the agricultural industry. This refers to financing options for farmers, agri-entrepreneurs, and others in the agricultural value chain. As an Non Banking Finance Company, we focus on ensuring that any farmer has access to a reliable way to receive financing that accommodates their unique financial circumstance.
Unlike conventional loans, agri finance has been designed bearing in mind that farms involve uncertain cash flows and risks. An employee in a salaried position typically receives a predictable monthly paycheck. On the other hand, a farmer must depend on seasonal cash flow that is often unpredictable because of the changing weather patterns that can’t always be anticipated, alongside the competition of market prices on a specific crop. The agricultural finance products are based around these realities, offering flexible repayment plans that relate to the farming cycle, including grace periods that reflect the growing period.
When farmers are able to use the correct financial products, they can spend money on high-quality seeds, modern equipment, irrigation, and adequate storage. The result would be higher productivity, lower post-harvest losses, and higher income stability for farm households. An Agricultural Finance Company helps fill that financial gap and provides timely access to the right products..
Types of Agricultural Finance
Kissandhan, which is a wholly owned subsidiary of Sohan Lal Commodity Management Ltd. (SLCM group), a Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India (RBI), is a prominent Agri Finance Company offering a robust line of financial solutions at every stage in the agricultural life cycle.
Working Capital and Seasonal Loans
Farming begins with the provision of timely cash flow. Kissandhan provides short-term or working capital loans as a means to provide credit for seed, fertilizer, labor, irrigation, and other costs, with repayment tied to post-harvest revenues.
Agriculture Land Loans
Agriculture Land Loans provide long-term and flexible financing for farmers who want to access more farmland, invest in irrigation, or install additional farm infrastructure.
Commodity-Based Finance
Farmers can store their harvested produce in accredited warehouses, and warehouse receipts can then be collateralized to access financing, allowing the farmer time to make sales after meeting sale conditions that prefer outstanding sale conditions.
Equipment and Infrastructure Loans
Equipment and infrastructure loans support farmers to modernize, through the purchase of tractors, harvesters, farm machinery, warehouse and cold storage, and infrastructural agri-processing facilities.
FPO Financing
Loans for Farmer-Producer Organizations (FPOs) to enhance collaboration, strengthen mass farming, aggregation, and the collective procurement of agri-inputs.
Business Correspondent Lending
Kissandhan works alongside rural development partners deeply rooted in local communities to expand financial access to the last mile.
Jansamriddhi Loan (Micro LAP)
Loans against property give farmers and small businesses access to capital for working capital needs to support business growth.
Other Products
Kissandhan also has customized loans for agri-input dealers, traders, and processors covering every link in the value chain. As a whole, these solutions allow rural India to receive timely, transparent, and fair access to financial support.
The Role of NBFCs in Rural Finance
Non-Banking Financial Companies (NBFCs) are critical to closing the rural credit gap. Banks have always struggled, even with a relatively high number of branches, to actively reach rural agricultural communities. Banks require a lot of documents from a borrower, require a land mortgage to secure a loan, or take too long to approve a loan.
Entities like Kissandhan, a wholly owned subsidiary of SLCM, RBI-regulated NBFC and Agri Finance Company under the SLCM Group providing agri-focused financial solutions, are attempting to ease this this pain by creating products that are designed around the needs of farmers and agri community. We process loans quickly, have a limited amount of paperwork, and will take other types of collateral, paying attention to the lifecycle and local practices of the farmers. Our field officers are familiar with the farming practice and can speak in the language of the farmer, which helps our organization make financial services accessible.
About Kissandhan: Your Growth Partner
Kissandhan, a wholly owned subsidiary of SLCM, was started with one singular thought process – to create real financial inclusion for rural India. We are more than a finance company; we are partners with a genuine interest in the success of every farmer we work with.
We offer customers a comprehensive set of products, which includes Agriculture Land Loans, equipment financing, and lending through a business correspondent relationship. We provide liquidity solutions for growth through lending to farmers, Farmer-Producer Organizations (FPOs), and agri-businesses.
Kissandhan stands out by integrating technology, innovation, and agricultural know-how into its product offerings. Our focus is on digital platforms for fast and easy applications and disbursement. All our products are developed for the real needs of the farming community as easily as possible through simple terms, transparency, and speed of service.
The Road Ahead
The agricultural finance sector in India has changed quickly in recent years as digitized innovation, government regulations and increased financial literacy have increased the access of farmers to credit. The Government has implemented several important initiatives to uplift farmers, including the Kisan Credit Card (KCC) scheme, interest rate subsidy schemes for agricultural loans, and flagship schemes, such as PM-KISAN, targeted to foster small and marginal farmers. Companies, such as Kissandhan, have been at the forefront making financial services far more accessible, transparent, and farmer-centric than ever before.
Ready to Grow?
Kissandhan is ready to support you in your agricultural journey, whether it is expanding your landholding, purchasing new equipment, or obtaining working capital for next season.
Connect with us to see what the first step towards a stronger and more sustainable future behind the farm looks like.
