What they offer
Community based farming
India is short by 10 million tonnes of cold storage capacity due to which over 30 percent of agricultural produce goes waste every year, according to an industry report. More than 30% of produce from fields is lost to poor post-harvesting facilities and lack of cold chain infrastructure. Also 20% of food grain that India produces annually is eaten by rodents. Only 7% of food in India is processed. The United Kingdom process +65% of its food. Even a developing country like the Philippines processes as much as 45% of its food. India, the world’s second largest fruit and vegetable producer encounters a waste of close to 50% worth of produce. India has the honour of being the largest producer of milk in the world. However, the amount of Milk that it wastes or looses each year is said to be equal to the total Milk produced in the European Union.
About 60% of rural population resides in rural areas but agriculture constitutes only 17.8% of India’s GDP. The farming practices are too haphazard and non-scientific and hence need some forethought before implementing new technology. Increase in trade deficit due to lower productivity and consequent import of food commodities. Lack of framer’s inclination to take risk. Financial institution’s inability to provide hassle free and timely delivery of credit to farmers. 50% of the farming community avail credit facilities from private money lenders on high interest rate which result into rural indebtedness. Fragmented land holding in India makes it difficult for farmers to make heavy investment on machinery, labour and fertilizers.
A spectrum of micro-lending firms have mushroomed over the past few years but scaling up of these projects and bringing millions of people within the fold of microfinance is no mean task. Some of the key challenges are that the operating costs of providing microcredit are very high because of the small size of loans, the location of clients, and the high level of interaction clients have with MFI staff. Efficiency is a key concern because MFIs require much more staff and administrative efforts per rupee lent than mainstream banks.