In recent years, there has been significant changes in Agriculture Finance due to increased digitisation, policy changes, and an increasing awareness of agriculture as a major driver of national economic resilience.
As we approach 2026, Agriculture Finance will have evolved further into a deeper level of financial inclusion, strengthened linkages between Harvest and Supply Chain, with Farmers, FPOs, etc. being more easily able to access Credit and Financial Products.
As Agriculture Finance continues to grow, Kissandhan will continue to develop and implement innovative solutions to the Financial Challenges being faced within the Agri Value Chain.
In a time of evolving Agricultural Finance, the sector is moving away from the traditional method of providing Seasonal Loans to providing Structured Financial Products that meet the needs of the Agri Value Chain. There is a greater demand for Liquid Financial Products that are available to Farmers, Aggregators, Processors, Warehouses and Small & Medium-size Enterprises (MSMEs).
Growing Preference Towards Collateral-Based and Commodity-Linked Financing
A key factor influencing the future of agri-finance is the trend toward the use of collateral-backed lending and commodity-based lending. Since agricultural commodities are liquid, have tangible market value and are driven largely by market price movements, they are well suited for structured lending models. This can reduce the lender’s risk and allow borrowers to have access to enough working capital at the optimal time. As India continues to expand its warehousing and storage capacities, commodity-linked financing will likely be even more important in 2026.
Kissandhan has been a pioneer in this transformation by creating our Commodity based lending programs, which provide timely and flexible access to credit for farmers, traders and agri-MSMEs by linking their financing with the commodities they store. By linking the financing of a borrower’s stored commodity, the borrower’s ability to avoid distress sales, obtain better price realization, and maintain more stability in their operations increases.
Credit Assessment is now Driven By Technology and Faster Disbursement
Digitisation of the Agri Finance industry will continuously evolve the industry with technology offering faster credit assessment, real-time credit monitoring and automation of documents. Lenders will be able to assess borrower creditworthiness more accurately. As a result of the above mentioned, lending institutions will be able to complete a borrower’s credit assessment in a shorter time, at a lower cost, and allow greater reach to rural areas where access to credit is particularly limited.
Kissandhan’s technology-based integrated approach of all the lending industry process owners (onboarding, documentation and risk management) allows the lending industry to provide their clients with quicker lending decisions, transparent loan pricing and consistent levels of service across all states. By 2026 technology will no longer only support lending institutions’ decision making processes but also allow lending institutions to customize loan products for various segments of the agri economy.
Increased Access to Credit for FPOs and Agri MSMEs
As FPOs grow to a more marketable size, the need for a structured banking solution that provides financing to support the aggregation, processing and distribution of products to the market becomes apparent. Further, agri MSMEs have the need for liquidity to finance their procurement, transportation and manufacturing of goods/products and to manage their inventory. With continued government support and increased participation of private enterprises in the agri finance sector, this segment of the economy will receive some of the fastest growth from the access to formal credit resources.
Kissandhan has developed specific products to provide support to these groups by providing specialized lending to FPOs for invoice discounting. This type of solution is used to fill cash flow gaps, facilitate smoother procurement cycles, and provide long-term stability to businesses. As demand increases, Kissandhan is dedicated to being a consistent and affordable source of financing for new agri-entrepreneurs across India.
Kissandhan also recognizes that agriculture in India is diverse, so requires multiple commodity-specific financing solutions across multiple geographical regions and seasons. By 2026, demand for diversified financing will continue to increase as a result of increased production, greater price volatility and expansion of allied industries. Kissandhan currently finances an array of commodities including cereals, pulses, oilseeds, spices, and fibres. These diversified portfolios of commodities allows for improved risk management, while enabling continued access to credit throughout the calendar year.
Conclusion
Kissandhan offers financing solutions focused on meeting the needs of each participant in the agriculture ecosystem, using technology-based processes and structured forms of credit. These may be obtained through transparent lending methods and responsible credit practices. We are committed to supporting farmers, FPOs, and agri enterprises in increasing their ability to grow with confidence as we approach 2026. We want to ensure that our financial solutions meet the needs of every farmer and agri enterprise.
To learn more about how we can support you, please reach out to a member of the Kissandhan team or visit our website.
