STARTUP INDIA SCHEME
The scheme name is Start up India, This scheme was launched by Prime Minister Narendra Modi with an aim to make India a global leader. Ever since this scheme has launched, India has witnessed a massive surge in the registration of more and more Startup’s, Not to forget just after the launch of the Scheme digital India campaign had also been started, This Startup India scheme has put an extraordinary impact on India’s ease of business too. Let us know in detail about Startup India Scheme and the newly launched Startup Seed Fund Scheme.
India is a developing country, More than 54% of the population of India is below the age of 25 and that already tells that our country is full of intrepid individuals. However it is also a fact that most of our country’s talent couldn’t get a congenial environment to explore and show what they are capable of doing. We have billions of individuals in our country who are adept at the plethora of sectors. One can understand how the situation had been in past for new ideas by looking at the likes of Sundar Pichai and Satya Nadela, They both are born and brought up in India, Educated in India but now they are providing their services in foreign countries. It is evident that foreign countries had been providing better opportunities to Indian talents in the past but the situation of India has changed now, After the arrival of one scheme which has been regarded masterstroke by the government and a game-changer by some veteran economists.
About Startup India scheme
. On 16th of January 2016, Prime Minister of India Narendra Damodardas Modi launched start-up India action plan with a vision to build a strong ecosystem for monitoring innovations and bolstering start-up’s in India.
It’s been 5 years since the scheme was launched, India has improved and witnessed many new start-up’s, In the past 5 years, The Start-up India initiative has helped many young entrepreneurs to start their own business. The government focus has been on 3C’s- Capital, Courage and Connection which the Prime minister himself describes as main requisite to setting up any business.
Startup India scheme loan
Under the start up India scheme, Financial help is given to those who wish to start a business and at the same time, they are given a tax rebate, Apart from this government offers several other types of exemptions under the start-up India program.
The idea behind government’s start up India programme was to create employment opportunities for the youth in the country, For this, Government has also announced several concession to new entrepreneurs under the start up india initiatives, These included-
- Exemption from Income tax on Profits earned by entrepreneurs for first three years
- After investment, sale of property to exempted from capital gains tax of 20%
- Provision for liberal patent for new enterprises
- Reduction in patent registration fees by 80%
- 90- day period for entrepreneurs wanting to leave the business
- Innovation courses for students under Start-up India
- Exemptions on Government purchases under Startup India
However, to take advantage of Start up India, It is necessary to meet the criteria set by the government. On a priority, it is mandatory to tell the jobs that would be created from a new start up.
With the centre giving priority to start-up India, At present there are 25 states running the scheme and the remaining states and union territories are working to introduce the programme, An important role of the state is to reduce the regulatory burden from the startup founders which can be promoted by simplifying rules under the jurisdiction of the state.
Benefits of Startup India scheme
Ever since the start of the Start up India scheme, Many success stories have been scripted. But what this scheme has achieved in the last five years.
- Scope of Startups widened
- An entity shall be considered a start up for up to 7 years, Biotechnology startup for up to 10 years
- The scope has been broadened to include scalable business model with high potential of employment generation
- No letter of recommendation needed from incubator/industry association for either recognition or tax benefits.
- -Relaxed norms of public procurement for MSME
- Compliance norms eased to reduce regulatory burden on Startups
- Startup India hub was operationalised on April 1st, 2016 to resolve queries and providing handholding support to Startup’s
- Certain Tax exemptions had also been given to Startup’s
- Finance Act, 2016 provides income tax exemption for Startup’s for 3 years in a block of 5 years. If they are Incorporated between April 1st 2016 till December 31st 2019.
- New incubation centres being established under Atal Innovation Mission across India, Incubators would provide necessary infrastructure and assistance to Startups in their early stages of growth
- 8 research parks are also being set up under the Startup India initiative with an objective to enhance successful innovation through incubation and joint research and development efforts between academia and industry
Start up India has crossed 40 thousand marks for start up recognised by the department of promotion of Industry and Internal trade which offer services in various sectors like IT, technology, hardware, healthcare, agriculture, education, food and renewable energy.
ELIGIBILITY CRITERIA OF STARTUP INDIA SCHEME
There are some eligibility criteria’s on which a company can avail the benefits of start up India, Some of the key eligibilities are-
- Company must be registered as a private limited company or partnership firm or a limited liability partnership
- Business shouldn’t be incorporated or registered before five years
- The turnover must be less than 25 crore per year
- Business must innovate something new or upgrade existing technology
- Startup business should not be an outcome of restructuring existing business
STARTUP INDIA SEED FUND SCHEME
Are you the one who thinks that your start up idea is one in a million? If you feel that your idea and your plan both are perfect but you are unable to raise funds than you have got solution to your problem. We know that it is quite difficult to raise money with the help of the Idea only. Every potential investor asks proof of concept and how much you are earning in running financial year or how much you are going to earn, after giving a answers to all these questions, It is still not guaranteed that one will get the funding from investors, So you must be wondering is there any easy way or a scheme to get funding just with the help of your idea. Then yes you have the answer.
Recently, Government of India has launched, under which one can get the funding just with the help of your idea also can get loan simultaneously. So what is the name of the scheme, how to apply for it and what is the eligibility criteria to avail the scheme. All your queries have been answered.
Start-up India seed fund scheme
Recently, In the Union Budget 2021-22, Government of India launched Rs 1000 Crore Start-up India seed fund scheme, Under this scheme an individual can get the funding for proof of concept, product trials, product prototype, market entry and commercialization.
Under this scheme an individual can avail upto Rs 20 lakh financial assistance for the start-up.
OBJECTIVES OF STARTUP INDIA SEED FUND SCHEME
India has the third largest ecosystem for Startup’s still it was observed that many good ideas couldn’t even take off and some bought by foreign investors. All this happened because of insufficient backing from the system. That is why Start up India Seed Fund Scheme has been launched by Government of India.
Startup India Seed Fund Scheme (SISFCS) main aim is to bolster the young Startup’s in India, By providing financial assistance to Startup’s for product trials, market entry, proof of concept, prototype development and commercialization.
This will further allow these Startup’s to upgrade to a level where they would be able to raise investments from private investor and venture capitalist or seek loans from commercial banks or financial institutions.
ELIGIBILITY CRITERIA OF STARTUP INDIA SEEN FUND SCHEME
Now let us understand the eligibility criteria to apply in Startup India Seed Fund Scheme
- Startup must be registered through DPIIT (Department of promotion of Industry and Internal Trade), It is an integrated platform provides access to number of Government to Business (G2B) services such as filling of industrial entrepreneurs memorandum and Industrial license. In easy terms, The startup must be incorporated as a private limited company or registered as a partnership firm or a limited liability partnership.
- Turnover should be less than 100 crore INR in the previous financial year
- .A startup must not be incorporated more than 2 years ago at the time of application.
- The Startup must have a business idea for a product or service that is-
- Market fit- The idea of the Startup must have a particular target market
Commercially Viable- There must be proper planning behind your idea backed by specific data
Scalable Idea- The idea could grow in less time, It should also generate employment at the same time.
- It is recommended that the Startup should involve technology in it’s core product, service or business model.
- Any Startup which has received more than Rs 10 Lakh of monetary assistance or support from any other central or State government scheme shall be deprived of this scheme. (Not to include- Prize money from competitions and grand challenges, subsidized working space, founder monthly allowance, access to prototyping facility or access to labs)
- Indian promoters must own at least 51 percent of the Startup at the time of application to the incubator for the scheme, according to the Companies Act of 2013 and the SEBI (ICDR) Regulations of 2018.
- The government of India has also listed some sectors, If you apply under these sectors than the preference will be given to these sectors. The list includes- Social Impact, Waste Management, Financial, Water management, Education, Agriculture, Food & Processing, Biotech, Healthcare, Energy and Mobility, Defence, Space, Railways, Oil and gas and Textile.
To apply in the Startup India Seed Fund Scheme than one Government of India has made a website where one can apply for the scheme.
On the other hand, The newly launched Startup India Seed Fund Scheme bolster those individuals who have innovative ideas for the Startup’s but they lack the financial assistance or potential investor who can invest on their idea, This particular scheme will be helpful to those who are hanging at the very initial stage of their Startup. The only requirements to avail the Scheme are your idea should be Market fit, Your idea should be backed by a viable data and It should be a scalable Idea. These are some basic requirements the scheme demands, If an individual wants to kick start their business than this Startup India Seed Fund Scheme is a ready to go plan for them.
It is a fact that India is definitely the one of the biggest market in the world and the country do have enough talents that is having the capability of doing something out of the box or innovative in nature. We have already wasted enough country’s talent by letting them to abroad but these two schemes, Startup India initiative and Startup India Seed Fund Scheme has given a new ray of hope to young entrepreneurs who have just begun. The Startup India initiative was the need of the hour and as the date suggests that around 40,000 new Startup’s have been registered under this scheme under the span of only 5 years. You might be thinking that even after the five years of Startup India initiative what has changed in the country. To get the answer of what has changed after the arrival of Startup India Scheme than one should see India’s ranking in “Ease of doing business”. India has climbed to the 63rd rank out of 190 countries in the World Bank’s ease of doing business ranking whilst India was at 142nd rank in 2014 when the Startup India scheme wasn’t launched. However there may be some other reasons too for India’s emerging ranks in Ease of doing business but one can’t ignore the impact of Startup India Scheme in it.