Vrutti has partnered with HSBC India to launch the ‘FPO Shakti’ financing facility

Vrutti, part of the Catalyst Platform, has launched FPO Shakti, a blended, phase-based financing facility aimed at helping farmer producer organizations (FPOs) access timely and appropriate capital.

Backed by HSBC India and managed by Friends of Women’s World Banking (FWWB) India, the initiative seeks to bridge the long-standing credit gap that prevents most FPOs from growing beyond the early incubation period.

India has over 44,000 registered FPOs, but less than a third can obtain formal credit. Many stagnate after an initial growth phase as highly collateralized loans and strict eligibility standards keep them outside the formal financial system, creating a ‘missing middle’ that weakens rural value chains and limits smallholder income growth.

FPO Shakti addresses this challenge with a blended financing approach that brings together financial institutions, catalytic capital providers, buyers and technical assistance partners in a single operating model. The facility will support an initial cohort of 15 early growth FPOs, with plans to expand to more than 100 organizations.

The model combines revolving funds, guarantees, revenue-related financing and digital registration systems with tailor-made technical assistance. Over a structured 24-month acceleration process, 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 at HSBC India, said, “FPOs play a critical role in improving the socio-economic well-being of farmers. However, a large majority of FPOs face the challenge of accessing credit as they are either too large for micro-credit or too risky for mainstream financing. A structured intervention that builds the capacity of FPOs, strengthens governance and enhances business capabilities is the need of the hour. The facility will unlocking a pipeline of investment-ready FPOs by reducing credit barriers, strengthening governance and positioning them for sustainable market participation.”

Commenting on the launch, Raghini Badhrinarayanan, CEO of Vrutti, said, “This facility marks a shift from short-term project support to long-term institutional strengthening. FPOs need patient capital and the right support. With this model, we are paving the way for FPOs to function as enterprises while remaining rooted in community ownership and farmer value.”

Published on December 5, 2025