On 5th April 2016, PM Modi launched the Stand Up India Scheme with a motive to promote entrepreneurship at the grassroots level for creating employment opportunities and economic empowerment.

Stand Up India Scheme

Objective

The Stand Up India Scheme (1) has been specially formulated to facilitate bank loans between Rs 10 lakh & Rs 1 crore to at least one Scheduled Caste or Scheduled Tribe borrower and a minimum of one woman borrower per bank branch for setting up greenfield business.

The Stand-Up India Scheme can benefit over 2.5 lakh borrowers who can avail of benefits from 1.25 lakh bank branches in PAN India.

Eligibility Criteria

An individual must qualify for the following eligibility (2) to apply for Stand Up India Scheme,

• Applicant must be at least 18 years of age.
• Individuals can only avail of loans for a greenfield enterprise project, i.e., the first business venture of the individual.
• The borrower of the credit should own a minimum of 51% of the shareholding and control of the enterprise.
• The borrower must not be in default to any bank or financial institution

Documents Requirement for Stand Up India Scheme

The following documents are required to apply for a loan under the Stand Up India Scheme.

• Identity Proof: Voter's ID card, Driving License, Passport, or PAN Card. In the case of a company, a signature identification from current bankers of a proprietor, partner, or director
• Residence Proof: Recent electricity bill, telephone bills, property tax receipt, Passport, voters ID Card
• Business address proof: Address proof for enterprise

Other Documents Required

• Memorandum & Articles of Association of the Company or Partnership Deed of the partners
• Assets and liabilities statements of the promoters and guarantors, along with the latest income tax returns.
• Rent Agreement
• SSI / MSME registration, if applicable
• Copies of lease deeds of the properties being offered as primary and collateral securities
• Certificate of incorporation from RoC to establish whether the majority stakeholding in the firm is in the hands of the individual who belongs to SC, STor, Woman category
• Document proving an individuals identity concerning SC/ST category

How to Apply for Standup India?

A person belonging to the SC/ST category or a woman looking forward to starting a greenfield enterprise can avail of a bank loan under the Stand Up India Scheme by,

• Directly approaching the bank branch
• Via SIDBI's Stand Up India portal (3)
• Via the lead District Manager

Loan under Stand Up India - Everything You Need to Know

Terms of loan

Typically, at the initial stage, the approach of the Stand Up India Scheme is based on answers to a particular set of relevant questions (4).

Based on the response provided, the portal gives relevant feedback and helps in categorizes the visitor to the portal as a 'ready borrower' or 'trainee borrower'.

The answers to be provided by the borrower are,

• Location of the business
• Category of the applicant- SC/ST/Women
• Nature of the business
• Expected loan amount
• Available space for business- rented/owned/leased
• If handholding support is required

Loan Amount

Stand Up India scheme provides a composite loan, inclusive of term capital & working capital, of Rs 1 lakh to Rs 100 lakh.

Collateral Security for Loan

The bank's decision to request collateral security depends on the borrower's profile.

They can either request collateral security or provide the loan under the CGTMSE (Credit Guarantee Fund Trust for Micro & Small Enterprises) scheme without any collateral security.

Repayment of Loan

The loan provided under the Stand Up India scheme is approved with a repayment duration of up to 7 years with an interim period of a maximum of 18 months.

Rate of Interest on Loan

The interest rate should be the lowest applicable rate of the bank for the rating category and should not exceed (base rate (MCLR)+3%+tenor premium).

Bank Branches under Stand Up India Scheme

• Bank of Baroda
• Axis bank
• Canara Bank
• Central Bank of India
• Read the full list here

Connect Centers

You can look for the Agency names assisting with Stand Up India Scheme in your town by checking the Connect Centers available in your area.

The connect centers are available pan India in the states of

• Andhra Pradesh
• Assam
• Uttarakhand
• Bengal
• Kerela
• Tamil Nadu
• Read the full list here

The Stand Up India Scheme that comes as a part of the StartUp India Action Plan 2016 launched for encouraging startups and new businesses in India has provided a golden opportunity for all the budding entrepreneurs hailing from SC, ST, and women categories.