The availability of the REA group’s oil mills to process fresh fruit bunches (“FFB”) harvested from oil palm plantings in the vicinity of the REA group’s estates provides an opportunity for local communities to further their economic progress by developing smallholdings of oil palms in areas surrounding the REA group's estates.  The REA group provides support for such development through two different models: the “Program Pemberdayaan Masyarakyat Desa” or “PPMDM” and “plasma schemes”.

Under the PPMD model, each individual smallholder cultivates oil palm on his own two hectare plot.  The REA group provides technical advice and supplies each smallholder with fertilisers and chemicals on deferred terms on the basis that when the smallholder’s oil palm plantings reach maturity, all FFB produced will be sold to the REA group for processing and the REA group will, on an agreed basis, recover from the amounts payable for the FFB, the deferred amounts owed to the REA group.

Under the plasma scheme model, the land areas for development are provided by village cooperatives but the development is managed by the REA group for a fee, with the advantage that development and production standards similar to those of the REA group can be established in the plasma areas.  The costs of development are borne by the cooperatives but with funding from external sources, guaranteed by the REA group and provided on terms that FFB produced by the cooperatives will be sold to the REA group and that the REA group will ensure that, out of the proceeds of such sale, the cooperatives meet their debt service obligations in respect of the external funding.

Plasma schemes permit faster development than the PPMD model because in the latter case  the logistical constraints of dealing with a large number of individuals, each operating on a relatively small area, inevitably limits the rate at which smallholdings can be expanded.  For this reason, the REA group now concentrates its support for smallholder development on plasma schemes.