NAIF(National Agriculture Infrastructure Fund ): Strengthening Farm Infrastructure in India

Imagine you’re a farmer in rural India. You’ve harvested your crop, but there’s nowhere safe to store it. Or maybe you run a small agri-business and want to process raw produce, but the loan you need is either too expensive or out of reach. This is exactly the gap the National Agriculture Infrastructure Fund (NAIF) aims to fix.

Launched by the Government of India in 2020, NAIF (also known as the Agriculture Infrastructure Fund or AIF) is a massive ₹1 lakh crore scheme focused on building post-harvest infrastructure warehouses, cold chains, grading units, packhouses, and more directly at the farm-gate. In short, it’s about turning India’s scattered, loss-prone agri supply chain into a streamlined, income-boosting network.

Let’s break it down for startups, MSMEs, and agri-entrepreneurs who want to know how to use NAIF smartly.

Why NAIF Exists: The Purpose and Scope?

India loses nearly 30–40% of its perishable produce after harvest due to inadequate storage, poor logistics, and inefficient processing. NAIF was created to tackle this bottleneck.

Approved by the Union Cabinet in July 2020, the fund was designed as a 13-year credit facility that provides low-cost, long-term financing for creating or upgrading agri-infrastructure. It specifically focuses on:

• Farm-gate projects: cold storages, silos, warehouses, grading/sorting units, primary processing facilities.
• Community assets: bio-stimulant units, compost facilities, polyhouses, etc.
• Value-chain enablers: e-marketing platforms, refrigerated logistics, mobile storage units.

So, whether you’re a single farmer, a Farmer Producer Organisation (FPO), or an agri-startup, NAIF helps you build the backbone infrastructure that improves shelf-life, reduces wastage, and brings in better prices.

Real-World Impact: A Cashew Unit in Odisha

Let’s look at an example from Odisha. In 2022, Sri Maa Majji Gouri Cashew Industry set up a ₹57 lakh cashew processing unit. With a subsidized NAIF loan of ₹42.75 lakh at an effective interest rate of just ~5.5%, the business now employs 20 locals and sources cashew from over 40 farmers.

This is what smart financing can do: create jobs, boost farmer incomes, and build local value chains.

How NAIF Works: Credit That’s Actually Affordable

3% Interest Subvention

NAIF offers a 3% per annum interest subsidy (up to ₹2 crore loan amount) for a maximum of 7 years. That means if a bank charges 9%, you only pay 6%.

Credit Guarantee up to ₹2 Cr

Loans up to ₹2 crore are covered under the Credit Guarantee Fund (CGTMSE) which means no collateral required. That’s a game-changer for small businesses and startups that usually struggle with bank guarantees.

Wide Project Eligibility

NAIF supports a huge range of infra projects, such as:

• Warehouses and grain silos
• Cold storages and ripening chambers
• Sorting, grading, and packhouses
• Mini-processing plants for cereals, spices, dairy, pulses, oilseeds
• Digital logistics or e-mandis
• Polyhouses, mushroom farms, irrigation-based units

All banks, NABARD, SFIs, RRBs, NBFCs, and cooperative institutions are part of the lending ecosystem.

Who Can Apply?: Farmers, FPOs, Startups & MSMEs

NAIF is deliberately inclusive. Eligible entities include:

• Individual farmers
• FPOs and PACS
• Agri-cooperatives
• Self-Help Groups (SHGs)
• State agencies and federations
• Private agri-entrepreneurs
• Startups and agri-tech ventures
• MSMEs in the agri-processing or logistics chain

For startups and MSMEs, this opens a clear path: collateral-free credit, low interest rates, and long repayment windows.

Whether you’re setting up a grading center or a solar-powered dehydration unit, NAIF helps you do it without breaking the bank.

What NAIF Has Achieved So Far?

As of mid-2025:

• 113,419 projects sanctioned
• Over ₹66,310 crore disbursed
• Total investment catalyzed: ₹1.07 lakh crore
• Infrastructure built: Cold chains, dry warehouses, primary processing centers, e-logistics

In simple terms, it has helped tens of thousands of rural businesses, hundreds of FPOs, and countless farmers upgrade infrastructure, cut spoilage, and fetch better prices.

How StartupFlora Helps You Use NAIF?

At StartupFlora, we act as your growth partner in rural India. Whether you’re a farmer group, cooperative, or startup founder we help you make NAIF work for you, end to end:

Project Structuring

We help design your infrastructure project so that it fits NAIF eligibility from cost breakdowns to documentation.

Loan Application Support

We walk you through the paperwork, choose the right lender, and handle compliance needs—maximizing your chance of approval.

ROI Modelling

We assess financial feasibility and help project your returns, ensuring your business remains profitable post-loan.

Post-Sanction Guidance

Once your loan is approved, we guide execution—helping with vendor selection, installation, and subsidy claims.

Add-on Services

We also help layer other schemes PMFME, Agri-Startup Fund, NABARD subsidies—on top of NAIF to maximize support.

With StartupFlora, you don’t just get a loan you get a plan to scale without chaos or guesswork.

FAQs: Everything You Need to Know

What is NAIF in simple terms?
NAIF is a ₹1 lakh crore government loan scheme that funds warehouses, cold chains, and processing units. It helps farmers and agri-businesses build better storage and reduce post-harvest losses.

How much subsidy can I get under NAIF?
You get a 3% interest subsidy on loans up to ₹2 crore for 7 years. That’s a huge saving especially for MSMEs and FPOs.

Can startups apply for NAIF loans?
Yes. Startups and agri-entrepreneurs are explicitly eligible. If your venture works on farm-gate infra, processing, or logistics, you can apply.

What kind of projects does NAIF fund?
NAIF funds post-harvest and value-chain projects warehouses, cold storages, grading units, mobile packhouses, etc. It also funds greenhouse units, composting facilities, and processing plants.

Is there a collateral-free option?
Yes. Loans up to ₹2 crore are backed by a government guarantee (CGTMSE), meaning no collateral needed.

Which banks are involved?
All major banks, RRBs, NABARD, SFIs, NBFCs, and cooperative lenders are part of the NAIF ecosystem.

How long can the loan be taken for?
Loan duration is up to 13 years, with subsidy benefits applicable for the first 7 years.

Final Word: Build Infrastructure. Build Prosperity.

If you’re in the agri or rural space, infrastructure is not optional anymore. It’s the difference between margin and loss, between local sales and national reach.

The NAIF scheme is your toolkit, and StartupFlora is your strategy partner.

Let’s build storage, reduce waste, and unlock rural potential one project at a time.

Ready to Build Your Agri Project with NAIF?
Reach out to StartupFlora for NAIF consultation, eligibility check, or full project assistance.
Let’s turn your infrastructure plan into real rural impact.