Agripreneurs or any other entrepreneurs struggles with project finance. There are various sources of finance including bank term loan, govt subsidy, venture capital and self funds. In this article I will focus on govt subsidy. Indian Government in general, provides subsidy from 33% to 90% (almost 100%) to various individuals. Individual can be a farmer, an NGO or a private ltd company.
One has to be careful while looking for subsidy %. If one is looking for 100% subsidy on projects then its is my personal opinion to form an NGO and present the case to Govt. department. There are some drawbacks in it though. Because NGO does not share profit to its shareholders, it is unlikely that any private equity house (or venture capital) will be interested in venturing into your NGO. However keep in mind that this is not always true given that every big firm has corporate social responsibility cell which supports local NGO.
Forming an NGO and getting funds released from government has generally 3 years of gap. Govt guidelines suggests that it funds those NGO who are active and working from at least past 3 years. So the next question arise how to survive these three years before govt can issue any grant or support for the project.
Needless to say NGO founders are very capable and passionate about their work. This will directly or indirectly will arrange money from some or the other sources.
Generally, the local companies, friends and families come forward to support the NGO.
One has to be careful while looking for subsidy %. If one is looking for 100% subsidy on projects then its is my personal opinion to form an NGO and present the case to Govt. department. There are some drawbacks in it though. Because NGO does not share profit to its shareholders, it is unlikely that any private equity house (or venture capital) will be interested in venturing into your NGO. However keep in mind that this is not always true given that every big firm has corporate social responsibility cell which supports local NGO.
Forming an NGO and getting funds released from government has generally 3 years of gap. Govt guidelines suggests that it funds those NGO who are active and working from at least past 3 years. So the next question arise how to survive these three years before govt can issue any grant or support for the project.
Needless to say NGO founders are very capable and passionate about their work. This will directly or indirectly will arrange money from some or the other sources.
Generally, the local companies, friends and families come forward to support the NGO.
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