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Capital Capital

Financing is vital as capital is needed to provide infrastructure and working capital of a project. Without suffient financing infrastructure will be incomplete and the project operational costs will not be to be accommodated. As such, the project will be exposed to failure at various levels of implementation.
 
Objectives
Among the objectives of the financing services are:
  • To assist and to ease farmers' financial burden in starting of their project.
  • To encourage and to get farmers involved actively in their effort to expand food production project.
  • To encourage farmers to undertake commercial and high technology project as well as venturing into new strategic field.
  • To facilitate farmers in securing loan in the shortest time.
 
Scope and Methods of Implementation
The financing services are provided and implemented in several ways, among them:
  • A grant from the development allocation of FOA and other departments/agencies is provided for the infrasturcture project for food production. A farmer can apply for the loan to finance the operational project cost.
  • The Farmer's Organization (FO) can apply Farmer's Organization Loan Fund (K3P) or from the various loan schemes at Bank Pertanian Malaysia (BPM) ( which is now known as Agro Bank). The source of the loan to individual farmer is at their respective FOs and the nearest Agro Bank branch through:
    • Fund For Food (3F)
    • Fund for Small and Medium Industries
    • Farm Mechanisation and Atomation Financing Scheme (MAP)
  • Commercial Commun ity and Bumiputra Industrial Community Financing Scheme (MPPB)
 
Financing Services
Among the programmes which are funded through FOA grant allocation are:
  • Farmers' Unit Development
Whereas K3P loan is given priority to finance projects such as:
  • Short-term projects, such as marketing of paddy, vegetables and livestock.
  • Contract-based projects, such as supply and service contracts.
  • Crop, livestock and acquacutive projects, with guaranteed markets.
The FOA grant allocation is supervise by Farm Production, Agro-business, Industry and Farming Entrepreneur Development Division, according to the programmes set. K3P loans are managed by Agro-business and Industry Division, FOA Head Office. Loans under goverment scheme are managed by Agro Bank through its branches nationwide. Several others financial intitutions are appointed to be the representative for Central Bank of Malaysia to disburse the loans.
 
Benefit and Effect
in addition to the capital financing, projects which are financed by FOA or Agro Bank, the farmers will also receive servicessuch as, advice, supervision and appropriate project coordination, as farmers are FOA/Agro Bank's main clients.
 
Conclusion
Farmers are encouraged to secure the FOA and Agro Bank because the assistance obtained will assist and ensure the current and future projects run smoothly and according to the planning. For more information, please contact FOA office and/or the nearest BPM branch.