Making Farmer Producer Companies (FPCs) work for struggling small and marginal farms

S3IDF helps FPCs to strengthen the livelihoods of marginal farmer members by linking FPCs to critical missing business incubation services

Photo of S3IDF
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I confirm that I am fully aware of the eligibility criteria, and based on its description, I am eligible to apply to the CSV Prize 2017.

  • Yes, I'm eligible

Preferred language

  • English

Organization name

S3IDF

Year founded

2001

Initiative stage

  • Growth (the pilot has already launched and is starting to expand)

Annual budget in 2017 (USD)

  • $250k - $500k

Number of beneficiaries impacted so far

  • More than 100,000

Organization type

  • Nonprofit, NGO, or citizen sector

Secondary Focus Area

  • Nutrition

Headquarters location: Country

  • India

Headquarters location: City

Bangalore

Location(s) of impact

India, Sirsi
India, Motakondur

Website

S3IDF.org

Facebook URL

https://www.facebook.com/S3IDF/
https://www.facebook.com/manuvikasa/

Twitter URL

https://twitter.com/S3IDF
https://twitter.com/manuvikasa

Problem: What problem is this initiative trying to address?

Small and marginal farmers lack the capacity to increase their incomes and capture enough value for their crops due to their limited bargaining power with middlemen and inability to access business, financial and technical services. FPCs can help improve their livelihoods; however, government schemes aimed at fostering FPC growth target a development stage above what FPCs typically achieve with existing support. This disconnect affects the broader agricultural sector, limiting the yield potential and social impacts.

Solution Summary: What is the proposed solution? What do you see as its most promising aspects for creating shared value?

S3IDF will address the existing gaps by collaborating with local NGOs to strengthen FPCs, whose members include farmers and laborers of all ages, so that they can leverage government schemes. We will build FPC business acumen through targeted trainings, and facilitate acquisition of productivity-enabling technology, as well as critical operational capital. These interventions will create shared value for various stakeholders, including the financial institutions who will gain familiarity with agriculture lending, and technology providers who will gain access to new markets. Further, existing government programs, such as the Small Farmers’ Agri-Business Consortium (SFAC), which provides a credit guarantee to banks lending to these FPCs, will be able to overcome their disbursal challenges. Finally, S3IDF will create a knowledge-sharing hub for FPCs to discuss best practices with each other, fostering an enabling environment.

Impact: What is the impact of the work to date? Specify both the social and the environmental impact of your work

S3IDF is piloting our initiative in conjunction with Manuvikasa (local promoting NGO) to strengthen Pragatimitra (areca nut farmer FPC). In the 8 months of our initiative Pragatimitra’s membership has increased by over 30%, 83 agricultural laborers have been employed as a direct result of our engagement, 97 farmers’ incomes have increased by 22% and S3IDF has facilitated two capital infusions for the FPC, one from a local credit cooperative and one from a major financial institution, Vijaya Bank, using a combination of partial loan guarantees and demonstrated credit-worthiness.
Further, we assisted the FPC in acquiring a mobile de-husking machine that now allows it to re-purpose discarded areca nut husks, securing a sustainable water supply for FPC processing needs, and purchasing a biomass boiler that is more efficient than the traditional practice of burning wood. For more details on our impact and growth plans, please see attached PDF: S3IDF - Strengthening Farm Livelihoods.

Financial sustainability plan: How is this initiative financially supported? How will you ensure its financial sustainability long-term?

Grants: 85%
Corporate contributions: 5%
Other: 5%
Earned income: 5%*

Estimates are for the program’s first year, and draw on S3IDF’s existing pool of philanthropic capital. S3IDF will pursue additional grant funding for future project implementation. The initiative’s sustainability will further be reinforced by our effort to become empaneled consultants to the SFAC, which would significantly build our brand and allow S3IDF to scale through replication and disseminate our innovative approach to many more FPCs, potentially nationwide.

*The program is designed to recapture some of the economic value created for the FPCs through fees or returns on guarantees at later development stages. These revenue streams are expected to grow overtime and contribute to programmatic sustainability.

Unique value proposition: What makes your initiative innovative? How does your project differ from other organizations working in the same field?

S3IDF’s system-level approach leverages an existing government scheme to improve market outcomes for small and marginal farmers by identifying and bridging an implementation gap that would otherwise critically inhibit policy efficacy, social impacts and agriculture yields. S3IDF’s bridge integrates stakeholders across the value chain and fosters more inclusive practices, enabling catalytic strengthening for farmers and FPCs, scheme success, and regional replication potential.

Founding story: Share a story about the "Aha!" moment that sparked the beginning of this initiative.

Government strengthening schemes and policies can be effective but implementation realities often require additional inputs to realize full program potential. S3IDF recognized that the existing strengthening scheme did not intervene at the appropriate development stage to address FPC needs, and that the limited capacity of FPCs and local supporting NGOs critically inhibited the FPCs’ ability to strengthen from the ground up. S3IDF’s ‘Aha!’ moment was our recognition that this strengthening gap exactly aligned with the expertise that we have built over 15 years of hands-on, pro-poor entrepreneur incubation. Today we are working with several strong local NGO partners to address these fundamental strengthening gaps and evaluating opportunities for broader programmatic replication and scale.

Where did you hear about the Nestlé Creating Shared Value Prize?

  • Search engine

Evaluation results

4 evaluations so far

1. Overall evaluation

5 - This idea rocked my world. It’s awesome! - 0%

4 - This idea seems really exciting. With a little more polishing, it’d be among my favorites. - 25%

3 - I think the idea is great, but it needs some work before it moves onto the next round. - 25%

2 - I liked it fine but preferred others. - 50%

1 - It didn’t make my heart beat faster. Needs significant revisions. - 0%

2. Innovation

5 - Absolutely, 100%! - 0%

4 - I feel really good about this - very promising - 25%

3 - This has some good elements and some areas for development - 75%

2 - This doesn’t inspire me so much - 0%

1 - This entry is weak here - 0%

3. Social and/or Environmental Impact

5 - Absolutely, 100%! - 0%

4 - I feel really good about this - very promising - 25%

3 - This has some good elements and some areas for development - 50%

2 - This doesn’t inspire me so much - 0%

1 - This entry is weak here - 25%

4. Financial sustainability

5 - Absolutely, 100%! - 100%

4 - I feel really good about this - very promising - 100%

3 - This has some good elements and some areas for development - 0%

2 - This doesn’t inspire me so much - 0%

1 - This entry is weak here - 100%

Nothing stands out! I thought it was great. - 0%

5. Potential to Scale / Replicability

5 - Absolutely, 100%! - 0%

4 - I feel really good about this - very promising - 25%

3 - This has some good elements and some areas for development - 75%

2 - This doesn’t inspire me so much - 0%

1 - This entry is weak here - 0%

6. Organizational Leadership

5 - Absolutely, 100%! - 0%

4 - I feel really good about this - very promising - 50%

3 - This has some good elements and some areas for development - 25%

2 - This doesn’t inspire me so much - 25%

1 - This entry is weak here - 0%

7. Potential for Creating Shared Value

5 - Absolutely, 100%! - 0%

4 - I feel really good about this - very promising - 33.3%

3 - This has some good elements and some areas for development - 33.3%

2 - This doesn’t inspire me so much - 0%

1 - This entry is weak here - 33.3%

1 comment

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Photo of Mouhamadou Moustapha Seck

Congratulations for the initiative.