In today’s trying times, every business is struggling for its survival. To boost the SMEs, the Government of India has implemented several measures.
The list of such schemes and initiatives is quite extensive.
It showcases the importance of the sector and why the Government is keen on helping them grow.
Just like we need the right amount of food and nutrition to survive, running a business requires a constant flow of funds.
Be it a startup, an existing business, or a well-established enterprise, funds are the fuel that accelerates its growth.
Without an ample amount of a regular cash flow, making your business breathe in this competitive world is next to impossible.
Though today there are tons of banks offering business loans, the Indian government also has taken effective steps over the years to lend a monetary supporting hand to startups and even existing businesses to keep their operations going.
The top government business loan schemes that can help your business up and running are mentioned below and each government scheme is explained keeping in mind the aim of the schemes launched by the government of India.
- Startup India Scheme
- MUDRA Loans
- Stand-up India
- Credit Guarantee Fund Scheme for Startups
- SIDBI Make in India Soft Loan Fund for MSMEs (SMILE)
- Technology Development and Innovation Promotion Programme (TDIP)
- Biotechnology Ignition Grant Scheme
- Credit Link Capital Subsidy Scheme for Technology Upgradation
- Atal Innovation Mission (AIM)
TREAD (Trade-Related Entrepreneurship Assistance and Development)
If you need a loan for your startup business, there are many government schemes that extend loans for startup businesses in India.
The aim is to create an environment so that they remain sustainable and competitive.
1. Startup India Scheme: This is a special plan made by the Indian government to help people who want to start their own businesses. One part of this plan is called the Fund of Funds for Startups.
This fund gives money to investment groups, and these groups then give money to startups to help them grow.
Launched by the Government of India, this initiative aims to promote and support startups in the country.
While it includes various components, the Fund of Funds for Startups (FFS) is notable.
FFS invests in SEBI-registered Alternative Investment Funds (AIFs) that, in turn, invest in startups.
2. MUDRA Loans: These loans are for people who want to start really small businesses, like selling things on the street. There are three types of loans, of different sizes.
The smallest loan is for people who need a little money, the middle-sized one is for people who need more, and the biggest one is for people who need even more.
The Micro Units Development and Refinance Agency (MUDRA) provides loans to micro and small enterprises, including startups, under three categories: Shishu (up to ₹50,000), Kishore (₹50,001 to ₹5 lakh), and Tarun (₹5,00,001 to ₹10 lakh).
3. Stand-up India: This plan wants to help women and people from certain communities start their own businesses. They give loans from banks to these people, and they don’t need to give something valuable as a promise to pay back.
This helps them get started with their businesses. This scheme is aimed at promoting entrepreneurship among women and marginalized communities.
It offers bank loans ranging from ₹10 lakh to ₹1 crore to at least one Scheduled Caste or Scheduled Tribe borrower and at least one woman borrower per bank branch.
4. Credit Guarantee Fund Scheme for Startups: This plan makes it easier for startups to get loans from banks. The government promises to pay back some money if the startup can’t pay back the bank.
So, banks are more willing to give loans to startups. Launched by the National Credit Guarantee Trustee Company (NCGTC), this scheme provides collateral-free credit to startups up to ₹2 crore.
The credit is available for various purposes, including working capital and purchasing equipment.
5. SIDBI Make in India Soft Loan Fund for MSMEs (SMILE): This plan gives soft loans to small businesses and startups.
These loans are easier to pay back because they have lower interest rates. This helps the businesses get the money they need without too much extra cost.
The Small Industries Development Bank of India (SIDBI) provides soft loans to help startups and MSMEs meet the required debt-equity ratio for their projects.
6. Technology Development and Innovation Promotion Programme (TDIP): This plan gives money to startups that have cool and new ideas in technology.
The money helps them try out their ideas and see if they can turn them into real businesses.
This scheme, under the National Science and Technology Entrepreneurship Development Board (NSTEDB), offers financial support to startups to convert innovative ideas into viable technology-based ventures.
7. Biotechnology Ignition Grant Scheme: This plan gives money to startups that have new and interesting ideas in science, especially in things like medicine.
The money helps them test their ideas and show that they actually work. Managed by the Biotechnology Industry Research Assistance Council (BIRAC), this scheme provides early-stage funding to biotech startups for validating and demonstrating proof-of-concept.
8. Credit Link Capital Subsidy Scheme for Technology Upgradation: This is not just for startups, but for small businesses too.
The plan helps them get money to upgrade their machines and technology, which can make their businesses better.
While not exclusive to startups, this scheme provides capital subsidies to small-scale industries, including startups, to upgrade and modernize their technology.
9. Atal Innovation Mission (AIM): AIM is like a friend that helps students and startups who have cool ideas. They give them money and help them find a place to work on their ideas.
This way, they can turn their ideas into real things.AIM promotes a culture of innovation and entrepreneurship among students and startups. While not a loan scheme, it provides various support mechanisms, including grants and incubation support.
10. TREAD (Trade-Related Entrepreneurship Assistance and Development): This plan wants to help women start their own businesses. They give money and training to women who want to sell things or start their own small businesses.
This scheme focuses on supporting women entrepreneurs in non-farm sectors. It provides capital and skill development training to women to help them set up businesses.
Startup business loans are one of the best ways to get a business startup loan. This not only gives subsidies for various activities but can also help improve the goodwill of the company.
You can even claim tax benefits on business loans sanctioned to you as a part of a government scheme.
Additionally, you can try online lending platforms that can give you unsecured business loans at reasonable interest rates.
If you are looking to find an instant business loan for your startup, visit the Digital Suvidha Kendra and we will guide you through the process, documents required, and other relevant forms that are required to take business loans.
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