Monday, January 17, 2022

Stand Up India Scheme: Check Eligibility and Process!

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The Stand Up India Scheme initiative was launched by the Government of India on 16th January 2016 and is led forward by the Department of Financial services (DFS), Ministry of Finance. The Startup India Scheme is ultimately aimed at promoting women entrepreneurs of scheduled tribe ST. Along with that it also focuses on private limited companies.

The startup india initiative offers bank loans ranging from Rs 10 Lakhs to Rs 1 Crore depending on total project cost. In this scheme, each branch loans money to at least one scheduled caste (SC) or one scheduled tribe (ST) and also one woman entrepreneur for setting up a green field project. 

These individual enterprises must be in the manufacturing department, services or trading sector to get the loan sanctioned by the bank. However, the rule may change in the case of non individual enterprises: at least 51% of shareholding and controlling stake should be in the hands of either SC, ST, or a woman entrepreneur.

Stand-Up India Ecosystem

Stand Up India Eligibility

The eligibility requirements for the stand up india loan scheme is pretty simple and straightforward.

  • A person must be from SC/ ST or a woman entrepreneur above 18 years.
  • Loans under the Stand up Mitra scheme are only available for greenfield projects.
  • At least 51% of shareholding and controlling stake if it is a non-individual enterprise.
  • Loan borrower should not be in any debt from bank

Steps to Apply for Loan

Under this scheme, you have the option to apply via three different ways, which are as follows:

  1. VIsit the bank branch for setting up a loan or visit this link to access region wise list of eligible banks.
  2. Go to the Stand Up India Official Website.
  3. Apply through the Lead District Manager (LDM) List.

Requirements for Stand Up India Scheme Loan Application

There are certain requirements for this Startup India project scheme that everyone needs to follow to get loans sanctioned from the eligible banks.

  • Identity Proof (Accepted Documents – Voter’s ID/ PAN Card, Passport, Driving Licence or Signature from proprietor or partner or director (if a company)
  • Residence/ Address Proof – It may be anything like Recent electricity bill, telephone bills, Voter’s Id, Passport or Signature from proprietor or partner or director (if a company)
  • Address Proof for Business
  • One should not be a defaulter in any Bank or Financial Institution.
  • Assets and Liabilities statements of a company/ Partnership Deeds, along with last income tax returns slip.
  • Rent Agreement (If the premises is on rent)
  • Clearance from pollution control board
  • SSI/ MSME registration (Not required)
  • Xerox of lease deeds or if properties are being offered as collateral.
  • Documents identifying if the applicant belongs to SC or ST category.
  • ROC certificate to verify whether the applicant is from SC/ST/ Woman Entrepreneur category.

Note: These above checklists can be updated depending on the local requirements of the place.

Application Process for Loans for greenfield projects

The process of applying for Loans for brownfield projects i.e. The Stand Up India Scheme is very straightforward.

The Applicants need to provide data and answer 8-10 questions listed below.

  1. Address of the Loan Borrower
  2. Applicants must be SC/ST/ Woman Entrepreneur.
  3. Business nature
  4. Place for operating businesses.
  5. Resources for preparing a project.
  6. Technical and Financial requirements
  7. Any Bank account
  8. Total amount invested into project
  9. Margin Money Requirement
  10. Experience in operating any business.

Note: Based on the answers of above questions, the loan borrower is categorized into ready borrower or a trainee borrower.

Difference between Ready Borrower & Trainee Borrower

The difference between these borrower are as follow:

Ready Borrower

The case with the Ready Borrower requires no handholding support i.e, they are ready to take over and start the business as soon as possible as the loan amount is transferred to their account. 

In this stage, a unique application number is generated for the applicant and all the information shared by the entrepreneur is shared with the respective bank.

Trainee Borrower

The trainee borrower applicants are those who require assistance of hand holding or you can say newbie in this field. In this case, the SIDBI and NABARD helps applicants under StandUp India Scheme to arrange all the necessary requirements requested by the trainee borrowers.

  1. Financial Training at Financial Literacy Centers (FLCs)
  2. For Skilling Up – Special skilling centers such as Vocational Training Centres
  3. Training for EDPs at MSME District Industries Centers (DICs)
  4. Margin Money Training for required borrower
  5. Training at Offices of Utility providers for Utility Connections

Note: All the services can be accessed by any borrower even after the loan has been sanctioned.

Now, to monitor the process and work of local offices a Lead District Manager (LDM) will be appointed to guide the needy borrowers with his/ her expertise. Moreover, these organizations/ enterprises can (will) work with other organizations to speed up their tasks. This organizations can be Dalit Indian Chambers of Commerce and Industry (DICCI), Women’s Entreprenuer Associations and similar other.

As soon as the hand holding requirements for the trainee borrower are met and the LDM is satisfied with the progress of the borrower, then the loan application will be generated through the portal.

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