What Is Stand Up India Scheme?

Starting a business or firm is an uphill battle. There are many businesses with the potential for good breakthroughs but face high stiff headwinds. The Indian Government has been promoting entrepreneurship at the groundwork level. They are aiming and empowering for job creation and empowerment.

In India, people from SC/ ST communities and women face humongous trouble when starting or operating a business. They face huge barriers such as industry restrictions, education, social pressure, etc, to start a venture/ obtain loans. The noble effort under The Narendra Modi government has given relief to many entrepreneurs.

Under the #StandUpIndiaScheme, you will find various tweets from the government or associated bodies that talk about entrepreneurship. Even our Prime Minister, Shri Narendra Modi takes a personal interest in the well-being and prosperity of young businesses.

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Let’s discuss the Stand Up India Scheme in detail.

This scheme was presented and coordinated by the Department of Financial Services (DFS). It was introduced on 5th April 2016.

The financial aid ranges between Rs.10 lakh- Rs.1 crore. The government is aiming to set up greenfield enterprise that involves trade, manufacturing, and services.

In the case of group enterprise, 51% of the minimum shareholding stake and control must be held by the applicant. The applicant can either be a woman or an individual who belongs to ST/ SC community.

Many challenges in setting up enterprises and availing loans. There are many requirements of the business that should be met instantly. For example, there may be the need for raw materials, location for office or plant setup, etc.

The Stand Up India Scheme creates an ecosystem that provides a favourable environment for small enterprises. With the help of this scheme, borrowers can take loans from bank branches for their enterprises.

• Any individual from the SC/ST community and woman above the age of 18 can apply for this scheme.
• Beneficiaries should not be in default with a bank/ financial institution.
• Under this scheme, loans are available only for green field schemes.

• To simplify the bank loans for at least 1 SC/ ST and 1 woman borrower per Scheduled Commercial Bank’s branch.
• Encourage the communities from SC/ST and Women to become entrepreneurs.
• Offer loans for greenfield enterprises in the field of service, trading, agriculture, and manufacturing.

The details about the loan under the Stand Up India Scheme are:

This kind of loan is a composite loan. It means it is inclusive of a term loan and working capital. It is between 10 lakhs- 100 lakhs.

The main purpose of this loan is to help the entrepreneur to set up an enterprise in the manufacturing, trading, or service sector.

This scheme works under the theory that the project’s 25% margin money will be given by the other schemes of the central or state government that offers subsidies. There may be cases wherein the borrower has to bring in 10% of the project cost on their own.

The rate should not exceed (The base rate (MCLR) + 3 % tenor premium).

Individuals can get loans through Collateral Security. As fixed by banks, it offers Credit Guarantee Fund Scheme for Stand-UP India Loans (CGFSIL).

The individuals get a 7-year period to repay their loan back. The moratorium period is 18 months max to max.

You can apply for this scheme in 3 ways:

• You can directly go to the nearest bank branch. Apply for loans.
• Go to the portal of Stand-up India.

• Application form with complete information. Add a passport-sized photograph.
• You’ll need identity proof. It could be anything: your driving licence, passport, PAN card, voter’s ID card, etc.
• Submit residence proof like passport, electricity and telephone bills (Latest), or voter’s ID.
• Address proof of your business.
• Association’s balance sheet for the last 3 years. Assets as well as statements of liabilities of the promoters/guarantors.
• Any other document required by the bank.
• Copy of rent agreement.
• Partnership deed of the partners.

• It is estimated that during the 6 years of this scheme, it benefited more than 1 lakh women.
• Till March 2022, 133,995 accounts were sanctioned ₹30160 crores.

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The individuals will get an 80% tax rebate once file the patent application patent form. So, it is a good boon for individuals who want to start businesses.