✓Minimal Documentation ✓Flexible Repayment ✓Collateral Free Loan | Apply for Business Loan Now! Check Eligibility

The Union Ministry of Commerce and Industry launched the Startup India initiative in early 2016. This scheme has been providing financial support and incentives to startups, which have resulted in India becoming the third-largest startup ecosystem in the world.

 

A major contributor to the growth of India’s startups has been the loan schemes provided by the Indian Government. 

Top 7 Government Schemes for Startups

Here are some of the top schemes for startups launched by the Government of India: 

  • National Bank for Agriculture and Rural Development (NABARD)

The Central Government established NABARD to promote the Indian farming sector. Since 2019, NABARD has been running a venture capital fund with the aim of providing financial support to agricultural and rural startups. 

  • Credit Guarantee Scheme (CGS)

The Government of India has also started a Credit Guarantee Scheme to provide assistance to DPIIT-recognised startups. Under this scheme, the government established a fund with a fixed corpus to extend credit guarantees on loans provided to startups by banks and NBFCs. 

  • Pradhan Mantri Mudra Yojana (PMMY)

PMMY scheme aids micro, small, and medium enterprises through collateral-free loans. There are three categories of loans under this scheme. 

These include Sishu ranging up to ₹50,000 and Kishore ranging from ₹50,000 to ₹5 Lakhs, and Tarun extending up to ₹10 Lakhs.

  • Stand-Up India Scheme

The government launched the Stand-Up India scheme to promote the startup culture among the marginalised and vulnerable sections of society. 

Under this scheme, each bank branch has to provide a loan amount ranging from ₹10 Lakhs to ₹1 Crore. They need to provide this loan to one borrower each from SC, ST, and women categories setting up a greenfield enterprise. 

  • Coir Udyami Yojana

Administered by the Union Ministry of MSME, the Coir Udyami Yojana is a credit-linked scheme providing subsidies for establishing coir units. The Yojana covers projects with a cost of up to ₹10 Lakhs and one cycle of working capital, which is not included in the subsidy.

  • Bank Credit Facilitation

In association with various public and private sector banks, the National Small Industries Corporation (NSIC) provides credit facilitation facilities to MSME sectors and startups. 

This lending facility allows startups to meet their credit requirements when they are in the nascent stage of development. 

  • Market Development Assistance (MDA)

The Department of Commerce is the nodal agency that implements the Market Development Assistance (MDA) scheme for startups. This scheme seeks to facilitate various measures to promote export activities.

Read More

Eligibility Criteria of Government Schemes for Startups

Here are some of the common criteria to apply for government-aided startup business loans:

  • The company should not have completed 10 years from the date of its incorporation

  • The company must be a private limited company, partnership firm, or limited liability partnership

  • The company’s turnover must not exceed ₹100 Crores since its incorporation

  • It must not be formed by splitting another entity already in existence

Documents Required for Startup Business Loans

To apply for a startup business loan under a government scheme, you need to submit the following documents:

  • PAN card, Aadhaar card, Voter’s ID card, passport

  • Ration card, rental agreement, utility bills

  • Business address proof

  • Profit and Loss Account and balance sheet copies of the last 2 years

  • Income Tax Returns and Sales Tax Returns

FAQs

How can I get a government loan to start a business in India?

You can avail yourself of a variety of government schemes for startups and government schemes for starting new businesses. These include the MSME government business loan scheme, the MUDRA business loan, the Credit guarantee fund government business loan scheme, etc.

What is the Startup India scheme of the Government of India?

A flagship initiative, Startup India’s mission is to build a strong entrepreneurial ecosystem. This intent is to be an initiative that drives economic growth, prosperity of startups, sustainability, and large-scale employment across sectors.

What is the maximum amount we can get from a government scheme business loan?

You can get a maximum of ₹1 Crore under the Credit Guarantee Scheme (CGS) for business loans.

Does a credit score matter for government scheme business loans?

Yes, a credit score matters for a government scheme business loan as it reflects your credit history. So, if you have a good score, there are high chances of qualifying for government schemes for starting new businesses at affordable rates.

Which companies are eligible for the Startup India Scheme?

To apply for the Startup India scheme, a company needs to be a partnership or private limited firm with a minimum business vintage of 5 years. Moreover, the company should not have an annual turnover of more than ₹25 Crores.

Can I get ₹10 Crores in assistance from a government scheme for startup businesses?

NITI Aayog’s Atal Innovation Mission (AIM) provides financial assistance of up to ₹10 Crores to chosen funds for a period of five years. You can also search for other govt. loan scheme for new business establishments to secure the finances you need.

What type of startup businesses can avail of a loan under the Credit Guarantee Scheme?

Only the startups involved in manufacturing, services, and trading sectors can avail of benefits under the Credit Guarantee Scheme.

What is the beneficiary’s contribution to the project cost under the Coir Udyami Scheme?

As per the guidelines, the beneficiary of the Coir Udyami Scheme needs to contribute 5% of the project cost.

What is the maximum moratorium period available under the Stand-Up India Scheme?

You can avail of a mortarium period extending up to 18 months under the Stand-Up India Scheme.

Home
active_tab
Loan Offer
active_tab
Download App
active_tab
CIBIL Score
active_tab