Inclusive Business Model Analysis: Samunnati, India

Samunnati, India’s Largest Agri Enterprise having a Non-Banking Financial Company (NBFC) license, works with a vision of making markets work for smallholder farmers.

Samunnati helps the agri ecosystem operate at a higher equilibrium through it’s unique AMLA (Aggregation, Market Linkage and Advisory) approach synergizing the agri finance and agri commerce solutions. Samunnati’s AMLA approach keeps Farmer Production Companies (FPCs) and smallholder farmers (SHF) at the centre. FPCs are pivotal in helping SHF with shared interests to negotiate for better input aggregation, market linkages and extension services.

A recent business analysis sought to a) find ways for Samunnati and partners work closely with FPCs (including women FPCs) towards unlocking their business potential ; b) further deepen Samunnati’s engagement with women FPCs and women farmers to improve their incomes and climate resilience through accessing impact and climate funds at concessional rates and c) establish a business case for Samunnati’s AMLA approach in helping farmers earn higher income and better income resilience

Key findings and recommendations from the analysis include:

Farmer producer companies

1. FPCs receive services from Samunnati based on their level of maturity, which is determined by their liquidity, size of operations (# members, sourcing volumes, etc.), and track record with Samunnati.
2.  Samunnati’s network of dedicated relationship managers across regional and local offices aid in building strong relationships with FPCs through helping them develop detailed business plans, develop FPC social capital and initiate financial transactions by lending working capital for nascent and growing FPCs.
   
3. Samunnati’s engagement with FPCs result in establishing their financial and market transaction track record, which aids in FPCs obtaining access short-term and medium-term loans from other sources of formal credit from financial institutions.
   
4. FPC’s should strengthen their farmer engagement such that a higher % of farmers transact through FPCs, a key driver of FPC turnover and sustainability.
   

Deepening women farmers engagement in the value chain and bolstering their climate resilience

1. Samunnati has tailored for women financial products such as SAFAL (Samunnati Farmer Loan) that are availed for agriculture and agriculture-allied activities will significantly add to the farmer household income and income resilience.
2. Samunnati support women in playing a key role in climate adaptation and evaluates the possibilities to unlock several opportunities for them such as making of vermicompost, biofertilizers, biochar, operating fodder units and installing solar units etc.
   
3. FPCs in general and women only FPCs in particular enable creating of new livelihood activities such as livestock, food processing, grocery shops and other value adding activities. From Samunnati’s experience, often it is women that come up and take such opportunities.