Know About Stand Up India Scheme, Interest Rate, Eligibility

If you are a woman or an SC or ST individual with dreams of creating a business, but lack capital, then read this article. Know and learn how the StandUp India Scheme can help you achieve your heights of success.

What Is the Stand Up India Scheme?

Only 13.76% of businesses are owned by women entrepreneurs, 6.8% of Micro, Small & Medium Enterprises by SC, and 2.1% by the ST community. And to be more alarmed is that these stats were even lower in the previous decade. Therefore, to encourage participation from these communities and motivate them, the government of India started the Stand-Up India Scheme. Let us find out about the StandUp India Scheme in this article.

On April 5, 2016, the StandUp Scheme was introduced, through which the Indian government offered financial assistance to women and people from the SC and ST castes. Loan amounts for StandUp India ranged from one lakh to one crore. Stand Up India mandates that the bank branches lend money to at least one woman, one person from the SC, and one person from the ST categories.

Stand-Up India Scheme Eligibility

The eligibility criteria of the Stand Up India Scheme are as follows-

1. The recipient must be older than 18 years old.
2. A woman or an SC or ST community member must be the borrower under the StandUp Scheme.
3. The candidate must hold a 51% ownership stake in a new business.
4. The person must not have a history of financial defaults with banks or other institutions.

In every scenario where a non-individual enterprise applies to the StandUp India Scheme, at least 51% of the company must be held by a woman, a member of the SC, or a member of the ST.

Documents Required For Stand Up India Loan

The following documents would be asked for whenever applying for the Stand Up India program-

1. Identity proof such as Aadhar card, passport, etc.
2. Residence Proof, bank passbook, utility bill, etc.
3. Business Address Proof such as MSME certificate, GST certificate, etc.
4. Rent contract for the business, along with any required pollution control certificates, if operations are conducted on rented property.
5. Company’s Memorandum of Association (MOA), Partnership Deed, Articles of Association (AOA), etc.
6. Incorporation Certificate and Registrar of Companies (ROC).
7. Promoter and guarantor statements of assets and liabilities and their most recent income tax returns (ITRs).
8. The company’s predicted balance sheets and loan terms for the following two years.
9. A copy of all lease agreements or title deeds for any properties owned by the company as security.
10. SC/ST caste certificate, wherever applicable. 

Standup India Scheme Loan

Let us now see some features of the Stand Up India Loan-

1. Nature of credit- The loan provided under the plan is a composite credit that may include both a working capital loan and a term loan.
2. Loan Size- Up to 85% of the project cost may be loaned. For this to be applicable, the borrower must not receive any benefits from other programs covering more than 15% of the cost of the greenfield project.
3. Collateral- Along with other collateral the bank may want, the borrower must submit primary security when applying for a loan. A guarantee from the Credit Guarantee Scheme has been set up for the Stand Up Scheme and can be provided by the borrower.
4. Repayment- The loan borrowed should be returned in 7 years.
5. Moratorium Period- The moratorium period can be up to 18 months.

What Is The Target Group Of Startup India Loans?

The StandUp India Scheme permits one scheduled caste, one scheduled tribe, and one woman per bank branch to receive loans from 10 lakh to 1 crore to establish a greenfield firm in the manufacturing, trading, or services sector.

Startup India Loan Interest Rate

The Loan Interest Rate charged by the Startup India Scheme is the lowest rate financial institutions charge for women and SC/ST individuals. However, an upper limit exists that the Startup India Loan Interest Rate cannot exceed, which is the base rate MCLR + 3% + tenure premium. 

What Is The Repayment Period In Startup India Loan?

The Stand Up India loan has been approved with an 18-month moratorium and a Stand-Up India loan repayment duration of up to 7 years.

So, let us end the article by getting to know another scheme to help you start your startup. Startup Mitra Scheme strives to promote entrepreneurship and assist people in realising their ideas in unique ways. The scheme also hopes to create a startup environment in India’s Tier-2 and Tier-3 cities. Henceforth, starting a business is about one step towards the goal.

Check out more Government Schemes 

MSME Loan Schemes in India

Savings Schemes in India

PMEGP Scheme/Loan

SATAT Scheme

Startup India Scheme

Jan Samarth Scheme

Cent Kalyani Scheme

RoDTEP Scheme

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