The Indian government is known to have various loan programs from time to time to ensure the development of the country and its economy. The best example of this will be the Stand-Up India Scheme which aims to encourage the entrepreneurship spirit hidden inside individuals and give them a chance to realize their dreams into reality.
Learn more about – 5 Government Loan Schemes For MSMEs & Startups In India
But what exactly is the Stand-Up India Scheme? Are the eligibility criteria too strict and what are the advantages of applying for the scheme? What is the application process to apply for the scheme? All of these questions will be answered in this article, so keep reading on till the end.
What is the Stand-Up India Scheme?
Stand-Up India Scheme is a new scheme initiated by the Financial Service Department of India. Any individual belonging to the minority categories of SC/ST or is a female who seeks to establish their own business venture in manufacturing, personal services or trade, can avail of this scheme as long as the enterprise they are setting up is greenfield.
The government assists these individuals by allocating them a loan of a minimum of Rs.10 lakhs to Rs.1 crore for their business. In case a business venture needs funding but is owned by multiple people, they can still avail of the loan as long as one of the owners belongs to the SC/ST category or is a woman and has 51% stakes in the company.
Stand-Up India Scheme has various details that one should keep in mind before availing the scheme –
- Nature – Composite.
- Purpose – To facilitate individuals who are in the minority for setting up their own greenfield enterprise business.
- Size – 75% of the funds that the actual project costs. Not applicable if funding from other sources exceeds 25% of the project costs.
- Interest – The barest minimum rate offered by the bank depending on the individual’s category.
- Security – Fundamental security. Depending on the bank’s decision, either some form of collateral or assurance from the CGFS team.
- Duration – 7 years with a moratorium period of one and a half years.
- Working capital – The borrower may utilize a withdrawal limit of 10 lakhs of working capital. Withdrawals above that amount need to be allowed by the Cash Credit limit.
- Margin Money – A bare minimum of 10% funding is required from the side of the borrower.
Benefits of Stand-Up India Scheme
There are various benefits of the Stand-Up India Scheme that can assist an entrepreneur set up their own venture with ease. These benefits are –
- The barest minimum low-interest rate that the bank can offer.
- Reimbursement for amounts up to 3/4th of the total project costs.
- Long loan repayment period with especially long moratorium period.
- Minimal and very basic security.
Application Requirements for Stand-Up India Scheme
For availing of the Stand-Up India Scheme, one requires several documents for their application. These documents are vital if you want to be the recipient of the benefits of the loan. Documents like –
- Any form of authorized Identity proof.
- Any form of authorized proof of residence.
- Valid proof of business/project address.
- Applicants can’t be defaulters.
- Partnership or association deeds of the business.
- Income tax returns.
- Your assets and liabilities statement as well as your guarantor’s.
- Photocopy of lease of the property that is being offered as collateral.
- Documents verifying the applicant’s caste.
- Additional documents if your loan request exceeds Rs. 25 lakhs.
Eligibility for Stand-Up India Scheme
To be eligible for the Stand-Up India Scheme, you need to pass out several eligibility criteria. Only then will you be able to apply for the loan, or else your request will be flat out rejected. These criteria are –
- Individuals who belong to the SC/ST category and/or are women and have completed a bare minimum of 18 years of age.
- Individuals who are planning to start greenfield projects, i.e., projects that can be established on pre-existing property or infrastructure.
- Individuals who have not been assigned as default in any bank or financial institution.
- Businesses that are owned by SC/ST or women with a minimum of 51% stakes.
How to Apply for Stand-Up India Scheme
To sign up for the Stand-Up India Scheme at the Stand-Up Mitra portal, simply go to their website and register. After following a number of steps and answering a few questions, you will successfully be able to login into the Stand-Up Mitra portal with your details.
Applying for the Stand-Up India Scheme is very easy as long as you have a set idea of what you are doing and are aware of the amount you intend to receive.
- Step #1: We will strongly recommend visiting www.standupmitra.in. This is the scheme’s official website and can help you receive detailed information about the loan and its various aspects. This will assist you in understanding the scheme details better.
- Step #2: The home page should display a register button. Click on it and answer whatever questions the website asks you with the utmost honesty and sincerity.
- Step #3: Your answers will be recorded and evaluated. Based on how you answered your questions, you will be classified as either a Trainee Borrower or a Normal Borrower.
- Step #4: Your requests are recorded and sent back to the feedback desk, who then will judge if you are worthy of being eligible for the scheme or not.
- Step #5: If the eligibility comes off as yes, then you can successfully register into the website and log in with your details.
- Step #6: When you are done logging in, the first thing you will see is the option to create a loan request. Follow the detailed instructions from there on to avail the benefits of the scheme.
Meet the Experts for More Support
MSMEx is an MSME Business Education Platform, which helps small businesses and MSMEs connect with industry experts. You can talk to several business experts at MSMEx who will assist you throughout your loan application process. If interested, you can consider getting in touch with an expert here at – https://www.msmex.in/contactus
Related Read About –
- Top 4 Government Loan Schemes for MSMEs in India
- How To Apply For Government Loan Schemes & Subsidies For Small Business In India?
- Registering A Business In India: Registration Of A Small Scale And A Large Scale Business
- How To Get An MSME Loan For A New Business? Know Schemes and Benefits of MSME Loan
- SHWAS And AROG Loan Schemes By SIDBI To Support MSMEs – Know The Scheme Benefits & Its Application Process
- Grab MSME Loan In 59 Minutes – The Detailed Guide To PSB Loan Benefits & How To Apply
- Pradhan Mantri Mudra Yojana – Mudra Loan Features, Benefits And Documents Required
- What Are MSMEs? Its Definition, Benefits, Registration Process And Classifications Explained
- Which Business Comes Under MSME? Explore the Complete List of MSME Businesses
- Benefits Of MSME Registration In India