STAND-UP INDIA SCHEME

STAND-UP INDIA SCHEME

Stand-Up India scheme was unveiled by Hon’ble Prime Minister Narendra Modi on April 5, 2016 as part of the government's initiative

To encourage entrepreneurship among women and the SC & ST communities. The program encourages in procuring loans from Rs. 10 lakhs to Rs. 1 crore for these communities and promotes their involvement in setting enterprises. The minorities have always faced the want of equal opportunities in the Indian society, their voices suppressed and their rights marginalized.

Stand Up Mitra will make these Indians independent, especially in establishing themselves outside the farming sector.

The requirement of a loan is essential for a greenfield entrepreneur or a small-scale industrialist who wants to venture in the MSME.
 

Eligibility Criteria and Interest Rate

  1. Age criteria: 18 years for SC/ST and women entrepreneurs.
  2. At least 51% of the shareholding stake must be held by a SC/ST or a woman entrepreneur.
  3. Loans are offered only for Green Field Projects (first-time venture).
  4. Loan amount is between Rs.10 lakh and Rs.1 crore.
  5. Borrower’s financial repayment status should be never being a defaulter to any bank or NBFC.
  6. Repayment period is a maximum of 7 years and a moratorium period of up to 18 months.
     

How to Apply

Accessing the website www.standupmitra.in can give the user the opportunity to borrow a loan for their business. In most cases, when a person wants to procure a loan, their application is not accepted by the banks for the want of assets or guaranteed returns. However, in six steps, one can procure a loan under the Stand-up India Scheme

  1. Business Information to be provided by the borrower.
  2. Background information to be provided of the proprietor, partner or director.
  3. Associates, credit facilities that the firm has, and the proposed credit facilities required by the business.
  4. Future financial prospects including the plans of expansion of the business, expected turnover, profitability in order to repay the loan – A project report
  5. Statutory obligations: Documents to be uploaded
  6. Declaration form with the terms and conditions to be accepted by the borrower
     

Understanding the Step by Step Procedure
 

1.  Business Information

At the time of login, some information is filled in by the user. This will be reflected when the person opens the form. Apart from that, the user is required to fill details like:

  • PAN number of the website
  • Website of the Firm
  • Type of Industry – Trading/Manufacturing/Service
  • Drop-down menu to choose the Industry Group the firm belongs to
  • Details of the business activity undertaken by the firm
  • Company Identification Number 
  • GST Registration Number (if applicable)
  • Date of Registration of the Firm
  • ZED-rated business or not
     

2.  Personal Information to be provided of the Proprietor

Required details will be name of father/spouse, date of birth, contact details, experience in business, permanent address, director identification, Aadhaar Number, other KYC documents like driving license or passport, and whether one has a relation with the lender bank or not. 
 

3.  Associates, credit facilities that the firm has, and the proposed credit facilities required by the business.

  • Associate concerns: name and other details, address, current banking facilities, procured bank loans
  • Existing facilities in the borrower’s firm, details of bank accounts, the outstanding balance
  • Asset classification 
  • Financial security of the borrower’s firm
  • What kind of loan does the borrower want? (Term loan/CC, etc.)
  • Amount of loan required
  • Primary/collateral security that the borrower can offer
     

4.  Financial Projection Report

The report requires the details of net sales, net profits, net capital, and capacity utilization about the project in case of working capital. In case of a term loan, the borrower needs to give a quotation for purchasing the machinery and prospects of the repayment schedule of the loan and the proposed moratorium period.
 

5.  Documents to be Uploaded:

The documents to be uploaded can be in the format’s jpg, PNG, jpeg, bmp, or PDF. Also, before scanning the documents, they need to be self-attested. The size of the documents should be from 250 KB to 5 MB. 

  • KYC Documents including Aadhaar/PAN/Passport/Voter ID/Driving Licence
  • Passport-sized photographs
  • Address proof of the business
  • Address Proof –Utility bill/Aadhaar Card/Property Tax Bill, etc.
  • MOA and AOA
  • Rent agreement
  • Udyog Aadhaar Memorandum
  • Net worth of promoters
  • GST Registration Documents
  • ZED rating documents
  • External credit rating 
     

6.  Declaration 

The borrower needs to click in the checkbox to declare that he has no objection with the terms and conditions proposed by the lender and that the documents uploaded are bonafide and verified.

In the event that these documents are found illegal, the necessary action can be taken by the lender. The application can then be submitted for processing. 
 


 

Benefits of the Scheme

  1. India has ranked among the lowest countries that have women entrepreneurs. Most women entrepreneurs fail to get funding from venture capitalists and rely on themselves or on procuring tougher bank loans. The Stand-Up India scheme can bring a huge transformation in these statistics with women entrepreneurs getting the right kick start to their ventures. 
     
  2. The government not only provides loans to those who are starting a business as their capital investment but also to those who need refinancing your help if their company falls under the category of a start-up. 
     
  3. Awareness among the marginalized about how to start a business or what are the problem-solving techniques needed is definitely low. But with the scheme in operation and such other provisions made by the government to encourage, train, develop and bolster the growth of women entrepreneurs, it is hoped that things will change in the days to come.
     
  4. The scheme intends to get at least 2 entrepreneurial projects in every bank branch in the country and hopes to benefit 250000 potential borrowers according to its statement. 
     
  5. The number of self-employed women cruised up as soon as women found equal opportunities in society. Therefore, there is no question that if they get the right funding,  women will start businesses of their own as well. 
     
  6. The number of SC-ST entrepreneurs is also growing alongside. The Stand-up India scheme has also organized Connect Centres through which the reach of the NABARD and SIDBI increases. 
     
  7. The marginal tribes need to be supported so that they too can have a platform of being proprietors of their own businesses and lives.
     
EDITED BY SHRADHA JHA

Want to get your business journey featured on CLIQTAX ? Send an email to us at editor@cliqtax.com