Introduction
It is great to start a new venture in India, but it is fraught with issues. Right from conjuring up initial capitals to outwitting the legal formalities, each entrepreneur has his own set of issues to contend with at the start itself. But the Government of India has started sufficient schemes to ease things for new ventures and ensure that they flourish.
These 6 government schemes which all new businesses should be aware of are meant to assist small businesses and startup ventures as much as business facilitation, finance, access to credit, and innovation are concerned. In case you are about to venture into business or about to venture into business soon, these schemes will give your business the needed push.
1. Government Scheme: Startup India
Startup India is a scheme program that was launched in the year 2016 with a mission to encourage startup development and entrepreneurship in India. The scheme is such that it will promote a healthy environment for startup development and innovation.
Key Points:
- Income Tax Exemption: Tax holiday is given for three of the initial ten years from the incorporation date of the company to the startups that are eligible.
- Self-Certification: Startups can utilize the facility of self-certification under labor and environment law, thus reducing the cost of compliance.
- Patent Application via Fast-Track: Startups can avail a rebate of 80% or even more of the cost of patent filing.
- Networking and Exposure: Regular startup events, hackathons, and exchange programs expose them.
- Fund of Funds: The scheme provides financial support under the scheme through a Fund of Funds with a corpus of ₹10,000 crore created by SIDBI.
Who Can Apply
Startups that are a Private Limited Company, LLP, or Partnership firm, which have been incorporated in the last 10 years, and with turnover of less than ₹100 crore per year.
2. Government Scheme: MUDRA Loan (PMMY)
The government, in the Pradhan Mantri MUDRA Yojana (PMMY), sanctions financial help for non-farm, non-corporate micro/small businesses.
Types:
- Shishu: ₹50,000 or lower
- Kishor: ₹50,001 to ₹5 lakh
- Tarun: ₹5 lakh to ₹10 lakh
Benefits:
- No Collateral Required: They are un-secured loans, hence easy for new businessmen.
- Purposeful Usage: Can be used to expand business, equipment, inventory, etc.
- Easy Availability: From public sector banks, private sector banks, NBFCs, and co-operative banks.
Eligible For:
Street vendors, artisans, traders, service units, small industry, and rural entrepreneurs.
3. Government Scheme: Stand-Up India
Stand-Up India scheme promotes entrepreneurship among women, Scheduled Castes (SC), and Scheduled Tribes (ST) through soft access to bank credit.
Key Points:
- Amount of Loan: ₹10 lakh to ₹1 crore to start a new enterprise.
- Type Covered: Units for manufacturing, services, or trading.
- Time of Repayment: 7 years with a 18-month moratorium duration.
- Handholding Support: Handholding support extended at the district level.
- Each bank branch shall sanction a minimum of one loan to an SC/ST entrepreneur and a female entrepreneur.
There must be such a scheme that poor class people are empowered and are turned into entrepreneurs who facilitate country-wide economic progress.
4. Government Scheme: Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
In the CGTMSE scheme, there exists a credit facility collateral-free to new or even old small or micro units.
Key Features:
- Collateral-Free Loans: Working capital and term loans up to ₹2 crore.
- Credit Guarantee: 75% of default in the government-guaranteed loan.
- Widespread Network: Spread across scheduled commercial banks and regional rural banks.
- The scheme extends institutional credit from the banking system to non-security- or asset-backed enterprises.
5. Government Scheme: Pradhan Mantri Employment Generation Programme (PMEGP)
The PMEGP is with the objective of employment generation through provision of opportunity of self-employment in micro-enterprises.
Highlights:
- Subsidy: 15%-35% of project cost as margin money subsidy depending on area (urban/rural) and category of applicants.
- Loan Limit: ₹25 lakh for industry and ₹10 lakh for services sector.
- Eligibility: Any one above 18 years with minimum 8th class educational qualification.
- No Income Limit: Anybody can apply as per his/her financial condition.
- This scheme is very helpful for small-scale entrepreneurs to start production or service centers.
6. Government Scheme: Atal Innovation Mission (AIM)
AIM under NITI Aayog manages innovation, research, and entrepreneurship in India.
What It Offers:
- Atal Incubation Centers (AICs): Startups with funds and infrastructure.
- Atal Tinkering Labs: Lab experiments for students in schools to learn innovation skills.
- Grand Challenges and Competitions: Incentives and high-impact funding for projects.
- Least appropriate for technology start-ups, AIM inculcates a problem-solving and out-of-the-box thinking habit at a tender age.
How Government Schemes Benefit New Businesses
Government schemes for beginning new businesses are not just economic benefits but long-term growth capital.
The ways in which they benefit are as follows:
- Nurture First-Time Entrepreneurs: Capital subsidy-free and collateral-backed loan.
- Innovate And Culture: Incubation and mentorship centers.
- Offer Operational Convenience: Tax exemption and self-certification under Startup India.
- Make It More Accessible: Funding through a vast network of banks and financial institutions.
- Ensure Inclusivity: SC/ST, women, and small-town entrepreneurs have reserved schemes.
All these schemes put together make it easier to go from idea to launch.
Eligibility for These Schemes
Pre-register your firm and keep all the documents in hand before applying.
Common Documents
Business PAN and Aadhaar card
Incorporation certificate or Udyam Registration
Project report or business plan
Bank details
Other licenses, if required
Applications are online primarily and may include bank or state government authority verification.
India’s startup ecosystem is one of the world’s fastest-growing. These 6 government schemes every startup should know are key to helping this growth. From building a tech startup to setting up a retail store or manufacturing unit, government schemes are the go-to help that can make your journey to success easier.
Don’t let yourself get bogged down with lack of capital, bad exposure, or fear of being traditional. Employ these scams to a good end and establish a company that is profitable but also rational.
Need Help Applying? Contact Legal Dalal
Want professional guidance to apply for any of the above schemes? Legal Dalal has helped thousands of businesses across India register, apply, and benefit from government schemes.
📞 Call or WhatsApp: +91-8094237237
🌐 Website: www.legaldalal.com
Let Legal Dalal make your startup journey easier.
