Samunnati eyes $2 bn gross transaction value by March 2023

CHENNAI: The city-based agri enterprise Samunnati is looking at a gross transaction value (GTV) of $2 billion by the financial year ending March 2023

“We had closed last financial year at Rs 4,800 crore. Of this, Rs 2,560 crore was towards lending and Rs 2,200 crore for market linkages,” said Anil Kumar SG , founder-CEO, Samunnati, on Thursday, noting that for the current FY, the agri tech entity is on its way to reach the Rs 5,000 cr mark. Tamil Nadu contributes the largest market share of 38 per cent, followed by Maharashtra, Madhya Pradesh, Gujarat, Karnataka, Andhra and Odisha. It has seen a credit offtake of Rs 460 crore in November this year.

Samunnati, which pegs the repayment efficiencies at 98 per cent, is focused on three core activities – market linkages, capacity building and advisory services, that are aimed at serving the interests and needs of the small holding farmers (typically those with under 2 ha land holdings).

Having presence in over 100 agri value chains spread over 22 states in India, it has powered over $1.5 billion of GTV since inception in 2014. Samunnati has access to 4,500 plus farmer collectives with a member base of over 8 million farmers as it envisions impacting one in every four farming households through its network by 2027.

As part of this effort, it has, for the first time, tied up with a public sector State Bank of India (SBI). The country’s largest commercial bank intends to strengthen its reach and deepen its engagement with the FPO (Farmer Producer Organisations) segment as a promising asset class through the Samunnati partnership.

Earlier in June 2022, SBI and Samunnati entered into a co-lending partnership with the objective of ensuring funding to the FPOs and make the segment a promising asset class. With an initial amount of Rs 100 crore for the programme, the co-lending partnership is set to give a huge fillip to financial inclusion. Besides finance, Samunnati provides other important support such as digitisation of business operations, training and capacity building programmes necessary for the overall commercial success, profitability, and self-sustenance of the FPOs. The partnership ultimately aims to ensure smallholder farmers get access to much needed financial solutions at affordable interest rates. Since inception, the programme has benefited 17,348 farmers through their FPOs and FPCs (Farmer Producer Companies).

Shantanu Chandrakant Pendsey, chief general manager (ABU & GSS), SBI, hailing this unique co-lending arrangement with Samunnati, said this is an impactful initiative for the benefit of the smallholder farmers in India. “It is in perfect alignment with our goal of serving the farming community by enhancing access to finance and to mainstream FPO as an asset class and increase awareness of this class of farmer-owned entities among potential lenders,” he said, highlighting the reach that SBI offers through its 23,000 branches in the country.

While SBI’s underwriting standards does not enable providing capital, the Samunnati collaboration is an opportunity to co-provide access to capital, especially since two-thirds of the population is engaged in agriculture. “Besides this MoU focused on FPOs, we are also exploring other areas, such as infra creation for post-harvest period and co-creating/co-lending to agri start-ups,” he added.

Radhakrishna Rayabharam, CGM and Niraj Kumar Panda, general manager (NW 3) of SBI, Chennai Circle, have expressed interest to expand the co-lending program with Samunnati for the benefit of the farmers. SBI, Chennai circle handed over a cheque of Rs 2.32 crore towards reimbursement under direct assignment route of co-lending, to benefit the farmers through FPCs.