As the markets continue to go through a pandemic induced correction, a lot of focus has shifted towards planning for the future. A new wave of entrepreneurs will emerge and look at creating solutions and services for the new world that is set to emerge beyond COVID-19. “With investments from VCs likely to see a temporary downtrend and banks being careful about who they lend to in these times, govt. Incubation programmes and funding schemes are getting a lot of attention from the entrepreneurial community,” says Pincap MD Praveen Sinha. Being one of the advisors on several key financing schemes to the Government of India, I would say that there are several attractive financing options being offered by the authorities to encourage entrepreneurs of tomorrow.
Startup India – central to the vision of an Aatmanirbhar Bharat
Prime Minister Narendra Modi’s flagship program ‘Startup India’ has incorporated close to 40,000 startups since it was announced in January, 2016. Under this, individual state govts. have started their own incubation programs. The Yogi Adityanath led Govt. in UP wants to incubate 10,000 startups in a year under the New UP Startup Policy 2020. “The willingness of the govt. to nurture and support a startup ecosystem in the country is a good sign. Not only does this help the economy but also creates jobs and helps us in achieving self-reliance,” feels Praveen Sinha Pincap MD.
Indian Govt. Schemes for Entrepreneurial Ecosystem
- Pradhan Mantri MUDRA Yojana (PMMY)
Pradhan Mantri MUDRA Yojana (PMMY) is a scheme launched by the Hon’ble Prime Minister on April 8, 2015 for providing loans upto 10 lakh to the non-corporate, non-farm small/micro enterprises. The funds are available via banks, small finance banks, NBFCs etc.
- National Clean Energy & Environment Fund (NCEEF)
As the name suggests, this government fund has been set up to support startups which are working towards sustainable forms of energy.
- Sustainable Alternative Towards Affordable Transportation (SATAT)
It is an initiative aimed at setting up Compressed Bio-Gas production plants and make it available in the market for use in automotive fuels by inviting Expression of Interest from potential entrepreneurs.
- Dairy Processing and Infrastructure Development Fund
The Government of India had a announced creation of Dairy Processing and Infrastructure Development Fund under NABARD with a total corpus of Rs. 8000 crore over a period of 3 years (i.e. 2017-18 to 2019-20) in the Union Budget of 2017-18 for the sustained benefit of farmers.
Milk Unions, Multi-state Milk Cooperatives, State Dairy Federations, Milk Producing Companies, and NDDB subsidiaries meeting the eligibility criteria under the project can borrow loans from NABARD.
- NewGen Innovation and Entrepreneurship Development Centre (NewGen IEDC)
NewGen IEDC is a startup program launched by the National Science and Technology Entrepreneurship Development Board under the Department of Science and Technology, Government of India. This programme aims to inculcate the spirit of innovation and entrepreneurship among the science and technology youth, support and encourage the startup creation through proper guidance, mentorship and support.
- The Venture Capital Assistance Scheme
Venture Capital Assistance is financial support in the form of an interest-free loan provided by the SFAC to qualifying projects to meet the shortfall in capital requirements for implementation of the project.The Scheme was implemented during 2012-17 in the XII Plan. SFAC has formed tie-ups with 41 banks to provide financial support.
- Pradhan Mantri MUDRA Yojana (PMMY)
An exhaustive list of government schemes and initiatives to support the entrepreneurial ecosystem can be found here.
“Plenty of schemes are available to support SMEs and entrepreneurs and it is encouraging to see that these schemes are inclined towards supporting sustainable projects that can shape the future of the country. State owned PSUs such as ONGC and BPCL have also started many schemes to support the ecosystem by pledging a significant amount for the development of entrepreneurship. However, not everyone is aware of these financial schemes due to no proper awareness drive and the lack of uniform information and there needs to be a more conscious effort to make these funds accessible to the common man, “concludes Praveen Sinha.