Stand-Up India Scheme: Transforming the lives of women and SC/ST entrepreneurs
9 January, 2025
Synopsis:
- The Hon’ble Prime Minister of India announced the Stand-Up India (SUI) Scheme on April 5, 2016.
- The scheme aims to promote the Aatmanirbhar Bharat initiative by providing bank loans to women and Scheduled Caste (SC) or Scheduled Tribe (ST) individuals to start their entrepreneurial journey.
- The Stand-Up India Loan amount limit is between ₹10 lakh and ₹1 crore.
Introduction
The Indian Government is supporting women and underprivileged entrepreneurs by introducing schemes like the Annapurna scheme, Mudra Yojana scheme, and Stand-Up India Loan. This post discusses the Stand-Up India Scheme, highlighting its eligibility, loan details, benefits, and application process.
What is the Stand-Up India Scheme?
The Stand-Up India Scheme offers loans to at least one SC/ST individual and one female entrepreneur per bank branch to start a greenfield enterprise in the manufacturing, trading, or services sectors. The loan limit is between ₹10 lakh and ₹1 crore.
Eligibility for the Stand-Up India Loan
SC/ST or women candidates are eligible to apply
The applicant must be at least 18 years old
The loan is available to start a greenfield enterprise, which includes businesses in the services, manufacturing, trading sectors, or agri-allied activities
If it is a non-individual enterprise, an SC/ST individual or women entrepreneur must hold a minimum of 51% of the stake
The borrower must not be a defaulter of any bank or financial institution
Stand-Up India Loan Features
Loan type: A composite loan (combining Working Capital and Term Loan) between ₹10 lakh and ₹ 1 crore.
Loan purpose: The loan can be availed to start a new greenfield enterprise.
Size of loan: The composite loan size is 85% of the project cost. This condition on the loan size will not apply if the applicant’s contribution and convergence support from other schemes is more than 15% of the project cost.
Stand-Up India Loan interest rate: The Stand-Up India Loan interest rate is the bank’s lowest applicable interest rate for that particular category. The rate will not be more than the base rate (Marginal Cost of Funds Lending Rate + 3% + tenor premium).
Security: Apart from primary security, you can secure the loan by offering collateral or guarantee of Credit Guarantee Fund Scheme for Stand-Up India Loans (CGFSIL), depending on the specific bank’s requirements.
Repayment: The loan’s repayment period is seven years with a maximum moratorium tenure of 1.5 years.
Working capital: A working capital withdrawal of up to ₹10 lakh can be made by overdraft. The borrower is issued a Rupay Debit Card for convenience. The borrower must use the Cash Credit limit for working capital withdrawals above ₹10 lakh.
Margin money: The Stand-Up India Scheme offers up to 15% margin money in convergence with eligible State/Central schemes. The borrower can use these funds to meet margin money requirements or avail admissible subsidies, provided they have at least a 10% contribution to the project cost.
How to apply for the Stand-Up India Loan?
There are three ways to apply for the Stand-Up India Govt. Loan Scheme:
Visit the nearest branch of a Scheduled Commercial Bank, like HDFC Bank
Submit the Stand-Up India application form online on the Udyami Mitra Portal
Complete the application process through the Lead District Manager
Documents required for the Stand-Up India Loan
The documents you must submit with your Stand-Up India application form are:
Proof of identity
Proof of business address
Proof of residence
Rent agreement, if business space is on rent
Proof of the applicant not having defaulted at any financial institution or bank
Registration for Small Scale Industries (SSI) or Micro, Small & Medium Enterprises (MSME) if applicable
Applicant’s SC/ST category certificate
Latest income tax returns of guarantors and promoters and assets and liabilities statement
Articles and memorandum of association of the Partnership Deed/Company Agreement
Copy of title deeds and lease deeds of all the primary and collateral securities
In the case of working capital limits, projected balance sheets for the next two years; in the case of Term Loan, projected balance sheets for the loan period
Incorporation certificate from the Registrar of Companies (ROC) to certify that a woman or person belonging to the SC/ST category is the major stakeholder
The Stand-Up India Scheme has changed the lives of many women and SC/ST individuals by facilitating bank loans of ₹10 lakh to ₹1 crore through Scheduled Commercial Banks.
Visit your nearest HDFC Bank branch to inquire about the Stand-Up India Scheme interest rate and complete the application process.
Disclaimer: *Terms and conditions apply. The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.