How to Start a Farmer Producer Company in India?

Start a Farmer Producer Company in India

A farmer producer company is a business that involves members engaged in farming-related activities. Some of the activities include harvesting, procurement, grading, pooling, and marketing. Farmer producer companies are a combination of a private limited company and a cooperative society. In order to start a producer company, the individual must apply for farmer producer company registration as per rules and regulations.

Step by step procedure to start a farmer company in India

This section will mention all steps which must be taken to start a farmer company in India.

Members involved in the farmer producer business

Below are certain individuals who must be involved in the business –

  • Ten or more individuals who are producers and are engaged in production activities or
  • Two or more producer organizations or
  • A combination of 10 or more people and producer establishments
  • The companies can have only equity capital

Selection of the Producer Company Type

Members engaged in the producer company must understand all the types of producer companies before moving on to the registration step:

Selection of the Producer Company Type

Production Business

Production companies involve the manufacture and procurement of the products.

Marketing Business

This company mainly engages in the promotion of the products produced in production companies.

Technical Service Business

These companies engage in providing training and resources for research and development to the producers.

Financing Business

Providing financial assistance to the producers is one of the major goals of the financing companies.

Infrastructure Business

These companies provide all the basic requirements without which producers cannot undertake any production activity.

Registration Process

After selecting the type of Farmer Producer Company, the next step is Farmer Company registration. The rules specified by the Ministry of Corporate Affairs (MCA) are followed by producer companies.

Below are the steps involves in the farmer producer company registration process:

farmer producer company registration process

Acquire Digital Signature Certificate

The applicant must obtain a digital signature certificate (DSC). Digital signatures fulfill the requirement of signing documents electronically. Thus, it must be acquired.

Obtain Director Identification Number and Name Reservation

The proposed directors of the company must obtain DIN. DIN can be acquired along with producer farmer company registration through the spice plus Form.

The applicant must also apply for the company’s name approval by filling the SPICE plus form.

Preparation of MOA and AOA

After receiving company name approval, the applicant must draft and submit both MOA and AOA. All information must be included in both the documents.

Incorporation Application

All the documents (affidavit, MOA, AOA, and declaration) must be submitted along with the SPICE plus form. Once the Registrar of Companies (ROC) approves the application and documents, the applicant will receive a certificate of incorporation. The company name of the Producer Company must end with ‘Producer Limited Company’.

Documents required for Farmer Company Registration

Documents required by directors

  • Self-attested copies of PAN card, in case, if the director is a foreign national or NRI, Self-attested copies of passport
  • Self-attested copies of voter ID, driver’s license
  • Passport size photographs
  • Specimen signatures

Documents required for registered office under Producer Company

  • Scanned copy of Non-objection certificate (NOC) from the property owner,
  • Scanned copy of Rental Agreement, in case the property is rented,
  • Scanned copy of sale deed, property deed in case of owned property
  • Scanned copy of utility bill

Other documents

  • Memorandum of Association and Articles of Association of Producer Company which contains all important details about the company,
  • Declaration and Affidavit of the directors and members.

Memorandum of Association must include the following details –

  • Name clause
  • Situation clause
  • Object clause
  • Capital clause
  • Liability clause
  • Subscriber clause

Pre-incorporation Requirements

Certain conditions which must be fulfilled by the applicant long with farmer company registration are as follows –

  • The minimum number of 5 directors and a minimum number of 10 members must be a part of the company before the farmer company incorporation.
  • The minimum paid-up capital must be INR 5 lakhs or more.
  • There is no requirement for the maximum number of members in a producer company.
  • Farmer producer companies cannot be registered as public limited companies. They are registered as private companies.
  • The company must hold 4 board meetings every year.
  • Individuals engaged in the production of primary produce can only be involved in Producer Company.
  • “Producer Company Limited” must be included at the end of the company name.
  • Producer Farmer Company is registered as a private limited company.
  • All members of the company must be primary producers.

Annual compliances

The members must adhere to all the compliances mentioned by the authority –

  • Every producer company must file Financial statements, Notice calling a general meeting, Directors’ report, Auditors report and Balance sheet in form AOC-4 to the Registrar of Companies within 60 days from the date of annual general meeting,
  • Annual returns must be filed in Form MGT-7 within 60 days from the date of the annual general meeting.
  • An internal audit of accounts must be conducted by the producer company.
  • The company must hold annual general meetings.

Rules for sanction of loans to primary producers

A provision was passed with regards to loans, according to which loans can be easily attained by the primary producers.

Loans and advances

Loans will be issued to the members of the producer company within 7 or less than 7 years.


The members can avail of credit facilities within a time period of 6 months or less.


National Bank for Agriculture & Rural Development or NABARD is established to provide financial aid to small and medium farmers. Through a special loan scheme, members can obtain loans from NABARD.

What are the benefits of Farmer Producer Company?

Limited liability

The liability of the members of the farmer company is limited to the amount contributed by them.

Separate legal entity

The company is an entity that is separate from the company members.

Bonus shares

The members are eligible to receive bonus shares in the same proportion of shares held by them.

High Credibility in the company

There are higher chances of reliability and trustworthiness within company members.

Ease of making amendments

As the company rules and guidelines are lesser complicated, it is simple to introduce changes in the company.


A farmer producer company can be started within a few weeks after fulfilling all requirements. It is important to understand every step in the producer company establishment process so that the members can avoid penalties that may occur in the future.


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