Latest updates on the Stand-Up India scheme for entrepreneurs

Introduction

The government of India launched the Stand Up India Scheme in order to motivate women, the Scheduled Castes(SCs), and the Scheduled Tribes(STs) to establish themselves as entrepreneurs. The intent of this scheme is to infuse an entrepreneurial spirit into various segments of the society. It was launched in April 2016 and aims to offer bank loans ranging from ₹10 lakh to ₹1 crore to deserving persons willing to start new enterprises in the manufacturing, service, trade, and agriculture sectors. It is dedicated to creating self-employment throughout the nation, strengthening weaker sections, and encouraging inclusive growth through not just providing finance, but also counseling, mentorship, and access to facilities. Read more to find out about this loan scheme for entrepreneurs along with key benefits, eligibility, and the application process.

What is the Stand-Up India scheme?

The Stand-Up India Scheme is aimed at the establishment of greenfield units, i.e., first-time ventures, and aims to empower persons who might have difficulties in accessing finance and business support through conventional routes. For achieving the goal of inclusivity, the scheme obliges every branch of a scheduled commercial bank to disburse loans to one SC/ST borrower and one woman entrepreneur. The loans are of composite nature, both in terms of term loans and working capital, with a repayment period not exceeding 7 years and an optional moratorium period not exceeding 18 months. 

The scheme also mandates that the borrower should contribute 10% or more of the project cost from his own resources or out of other schemes. If the enterprise is a partnership or company, the eligible beneficiary must hold at least 51% of the shareholding. In addition to funding, Stand-Up India also provides end-to-end hand holding assistance through a specialized online portal, standupmitra.in, bringing entrepreneurs into contact with banks, training institutions, market linkages, and mentoring. This extended model not only covers financial support for startups but also enhances capacity and confidence among new entrepreneurs. By strengthening SC, ST, and women entrepreneurs, the scheme adds to employment generation, social balance, and inclusive economic growth in India.

Key benefits of the Stand-Up India scheme

Here are some of the key benefits of the Stand-Up India scheme – 

• Access to finance for marginalized groups

The Stand-Up India Scheme focuses on extending affordable loans to various groups such as Scheduled Castes (SCs), Scheduled Tribes (STs), and women entrepreneurs. These sections often struggle while accessing financing from traditional channels because of no credit history. With loans ranging from ₹10 lakh to ₹1 crore, such groups of the society find the necessary credit required to start a new business through Stand-Up India. Banks have to support these applicants with expedited approvals along with competitive interest rates. In addition to increasing personal empowerment, this focused approach to financial inclusion aids in closing long-standing economic divides across various societal groups.

• Support for first-time entrepreneurs

The initiative is especially helpful for new business owners, promoting innovation and risk-taking among those who might not have had financial support or business expertise before.  It ensures that endeavors from the bottom of the pyramid are encouraged rather than merely assisting established companies by concentrating on greenfield projects. In addition to financial support, entrepreneurs also get training, mentorship, and business advisory services. Their prospects of success and long-term viability rise when they have all these resources at their disposal. Aspiring entrepreneurs’ confidence is increased and a more inclusive and diversified business environment is fostered throughout the nation by Stand-Up India, which offers an organized path from concept to implementation.

• Comprehensive hand holding and mentorship

Along with financial support for startups, the Stand-Up India Scheme provides extensive handholding through its website standupmitra.in. Entrepreneurs receive mentorship through all steps of business creation, ranging from project planning and registration to skill development and promotion. The website links applicants to various support services such as training facilities, banks, government departments, and sector specialists. This support ecosystem is especially important for people from underrepresented groups who might lack networks and expertise in dealing with the nuances of business. Consequently, the program lays a good foundation for sustainable business and economic empowerment.

• Job creation and economic growth

Entrepreneurs can expand their venture through the Stand-Up India scheme. This encourages employment generation as well as development of the local economy. New enterprises require a workforce pool consisting of employees, managers, and other staff, resulting in additional job opportunities. This impacts the rural and the semi-urban regions positively, reducing urban migration to a considerable extent as well as enhancing overall prosperity in the area. The scheme also fosters a more diverse business ecosystem by promoting women and SC/ST enterprises, enabling more equitable economic growth for India. This aligns with the government’s overall vision for Atmanirbhar Bharat.

Eligibility criteria

The applicant must be either a woman entrepreneur or belong to the SC/ST category. The scheme supports the setting up of greenfield businesses which are first-time ventures in the manufacturing, services, trading, or agriculture-allied sectors. This focus on new businesses ensures that the scheme nurtures fresh entrepreneurial talent and encourages innovation among underrepresented groups.

The candidate must be 18 years and above, and they should not be in default to any financial institution or bank. For non-individual businesses, i.e., private limited companies or partnerships, the shareholding of at least 51% must be with an SC/ST or woman entrepreneur who qualifies. This regulation ensures that the main control and advantage of the financial assistance accrue to the target beneficiaries. The applicant must also bear at least 10% of the project expenditure, which can include assistance from other government programs.

The loan scheme for entrepreneurs is only for greenfield projects. The beneficiary should not have owned or run a similar business earlier. The business must be located in India, and the financing is made available by scheduled commercial banks, each of which is required to make loans to at least one SC/ST and one woman entrepreneur. The scheme has both term loans and working capital cover with an upper limit of ₹1 crore and a flexible repayment term of up to 7 years with an optional moratorium of 18 months. These specifications are made to ensure focused, inclusive, and effective support to budding entrepreneurs.

Application process for the Stand-Up India scheme

Here is a step-by-step guide to applying for the Stand-Up India scheme – 

• Visit the official portal

You need to visit the official Stand-Up India portal: www.standupmitra.in. It is the centralized portal to apply, access support services, and monitor progress. You can also access other useful information like FAQs, guidelines to the scheme, and a list of lenders.

• Register as a user

Once you click the “Register” button on the portal to create a new account, you will be redirected to a page where you have to provide basic information such as your name, mobile number, email ID, and Aadhaar number. After registration, you will receive the login credentials to access your dashboard on the portal.

• Fill in the application

Fill in the application by providing detailed information about your background (woman, SC/ST), type of business proposed (greenfield), sector (manufacturing, services, trading, or agriculture-allied), location of the business, the estimated cost and financing requirement. 

• Choose a lender and a hand holding agency

After your business details have been submitted, the portal will suggest nearby bank branches and handholding agencies such as SIDBI-approved training centers, incubators, and NGOs. You can select your preferred lender and support organization, which will guide you regarding business plan preparation, documentation, and bank coordination.

• Submit supporting documents

You will also need to upload documents such as Aadhar, caste certificate (if applicable), proof of identity and address, project report, business plan, and bank statements (if available). These documents help the bank assess your eligibility and the viability of your proposed business.

• Loan processing by bank

Once the application and documents are submitted, the selected bank branch will evaluate the proposal. If approved, the bank will sanction the loan, which includes a term loan and working capital component. The loan amount can range from ₹10 lakh to ₹1 crore, with a repayment tenure of up to 7 years.

• Post-sanction monitoring

After approval, the handholding agency continues to support the entrepreneur by helping with business setup, registrations such as GST, MSME, etc., marketing, and compliance. The entrepreneur can also return to the portal to access further support services, track the loan status, and receive updates on relevant government schemes.

Conclusion

The Stand-Up India scheme serves to overcome the economic and knowledge disparities that represent hurdles for budding entrepreneurs. Creating jobs and promoting inclusive economic growth nationwide are the other goals of the scheme. The initiative empowers underrepresented individuals and contributes significantly to the development of a more robust, diverse, and self-sufficient Indian economy by emphasizing financial inclusion and entrepreneurial growth.