The Need for Smarter Agricultural Finance
The primary support system for rural regions in India is agriculture. Agricultural financing is essential for farmers in continuing to operate their farms, purchasing better input, and reducing risk by providing funds to operate smoothly as well as manage risks associated with running a farm. A large number of small and marginal farmers do not have access to structured financial instruments that are designed specifically for agriculture due to the nature of the cash flow cycle as a result of the seasonal income cycles, the limited availability of formal credit or due to having cash flow problems all of which are hindering growth. Kissandhan, an NBFC regulated by the RBI provides structured financial products to assist in solving these issues for farmers and creates a better understanding of how to develop financial products in a way that meets the overall financial needs of agriculture and agribusiness.
Kissandhan as a Financial Enabler
Kissandhan was built with one singular purpose: to create real financial inclusion for farming community. It positions itself not merely as a finance company, but as a partner with a genuine interest in the success of every farmer it works with. This philosophy sets Kissandhan apart from conventional NBFCs. While most financial institutions evaluate a farmer’s creditworthiness purely on balance sheets and land ownership, Kissandhan looks at the whole picture – the commodity a farmer holds, the FPO they belong to, the crop cycle they operate in, and the local market dynamics they navigate every season.
More than 700,000 farmers already have been empowered with their financing solutions as of April 30, 2026. We aim to simplify access to finance, improving transparency and efficiency in financing through building stronger connections between the rural lending community and formal financial systems resulting in the expansion and impact of agricultural finance into regions that have historically been underserved.
FPO-Centric Financing Approach
FPOs offer farmers the opportunity to come together, and create a collective strength thereby creating a greater ability for them to work collaboratively. Kissandhan’s financing solution is also designed for FPO’s and allows farmers to get access to greater amounts of credit, which reduces the individual financial burden on farmers. Farmers’ ability to utilize their collective strength improves their bargaining power and increase their operational efficiency, allowing them to participate more fully in the larger agricultural value chain. Therefore, Kissandhan’s support of these FPO’s enhances the development of a more formalised and sustainable financing ecosystem.
Commodity-Based Finance for Better Price Realisation
Farmers are often forced to sell their goods soon after harvest at substandard prices. Kissandhan solves this issue by offering farmers commodity-based financing against their stored produce to give them time to wait and to sell at a better time rather than be forced to sell under duress creating an imbalance in bringing liquidity to them without causing them to give up ownership of their crop.
By providing solutions that offer align financial support for the needs of the farmer with the current agricultural cycles creates a more balanced system that is also friendly to farmers.
NBFC-MFI Lending to Strengthen Agri Financing
Kissandhan enhances the overall ecosystem by providing funding to NBFC-MFIs that are able to provide loans to farmers. The overall goal is to provide access to funding and other financial services to farmers, particularly those located in remote regions. Kissandhan evaluates NBFCs using a comprehensive process that evaluates both the performance of the NBFC and the operational risk profile of the NBFC, ensuring the responsible and efficient use of credit. Kissandhan defines loan structure (e.g. loan term lengths and scalable loan amounts) and supports the development of agri-focused lending networks. As such, Kissandhan supports the success and growth of agricultural finance across regions.
Partnerships and Overall Impact on Farmers
Providing credit through its partnerships with NBFCs and other financial institutions, Kissandhan also supports the delivery of financial services at scale. Kissandhan uses its integrated approach to financially serving farmers in multiple ways (i.e., through customer onboarding, documentation, and streamlining the financial process), thereby resulting in reduced delays and reduced complexities in providing those services. By empowering farmers to make smart financial decisions, Kissandhan is having a positive impact on the agricultural ecosystem as a whole.
The initial step in giving strength to farmers is to provide them sufficient financial strength at the right moment. Check out Kissandhan’s website for all sorts of smart agricultural finance solutions that will help create a more sustainable future for farming.
What does agricultural finance mean and why is it significant to farmers?
Agricultural finance refers to the financial services that support agricultural activities, including loans and credit solutions, which allow farming operations to manage their expenses, invest in products and services, and facilitate the use of working capital.
In what way does Kissandhan provide financial support to farmers?
Kissandhan connects both farmers and FPOs and the formal financial sector in order to allow for their access to customized credit solutions that meet the needs of the agricultural sector.
What is meant by commodity-based financing?
Commodities financing refers to a financing strategy that utilizes loans or advances to finance against commodities that are held in inventory, enabling farmers to perform agricultural operations without needing to liquidate their agricultural commodities at depressed prices immediately after harvest.
What are the benefits of using Kissandhan for an FPO?
Kissandhan enables FPOs to have access to larger amounts of finance, reduced financial risk, and increased ability to negotiate future terms of trading, thereby enhancing the overall growth potential of the group of farmers.
What role do NBFC-MFIs play in Kissandhan's model?
NBFC-MFIs function as a method of flowing credit to farmers by completing the last mile for financial service delivery by providing credits to farmers in remote areas, which allows for the use of financial services in very remote rural areas.
