Agri Investment Platforms: From benefits to risks; all you need to know

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₹5,000 and may go up to 15 lakhs. While allowing diversification in the investment portfolio, they also offer investors significant returns higher than traditional investment options making it a lucrative investment option.

Also Read: TGIF Agribusiness IPO: Check GMP, subscription status on day 2, issue size, key details to know A retail investor makes an investment in these platforms via the website or mobile app in an online mode. Usually, he or she may be asked to sign the LLP (Limited Liability Partnership) agreement and complete authentication.

The investments are pooled from all the investors and invested further. For example, these may be further invested to lease agricultural land or invest in projects related to agriculture. Now, the product is sold and revenue is generated.

After deducting certain expenses such as salaries, rent, raw material costs, etc., the rest is distributed among the investors. Investors usually earn fixed returns specified in the LLP agreement which was signed at the time of making investments.

Also Read: Skymet predicts normal monsoon, boosts hopes for India's agriculture-dependent economy Investment in agricultural schemes like these is not always sunshine and rainbows. It comes with its share of risks and uncertainties.

Firstly, profits are not assured. Though they may guarantee fixed returns, if the firm incurs losses, you will have to incur them as a partner. Weather uncertainties can result in loss of produce which may lead to a high risk of losing returns on investments.

Then, these platforms are not regulated by SEBI or RBI. So, there is no authority to control or monitor the activities of such platforms. In 1990, the Anubhav Plantations scam case was a major financial scandal.