Let us first know about Start up India scheme. Startup India scheme is an initiative by the Indian government to promote startups, generate employment and wealth creation. Under this scheme, government offers fund up to Rs. 2500 crores for startups and credit guarantee fund of RS. 500 crores.
What is the eligibility of loan under startup India?
Startup India scheme by the government of India has its own pre-requisites for giving a loan and eligibility requirement to offer loans.
Here are a few requirements for registration of a startup.
- The company has to be registered as a private limited or limited liability partnership
- The company cannot be older than 5 years and the total turnover should not be more than Rs. 25 crores.
- The firm should be approved by Department of Industrial policy and promotion.
- The company must possess a recommendation letter.
*There are certain other requirements to clear on the requirements for startup registration. After the you are clear on the eligibility requirement. You have to register your firm as a startup be it private or in partnership.
The formal application includes the following steps.
- Log on startup India portal.
- Enter your legal entity, registration number and date.
- Enter your PAN number
- Enter your address and state.
- Enter the details of authorized representative, details of partners and directors.
- Upload the required documents.
- File for the registration of certificate for the company.
After the successful registration of company along with the possession of required business licenses and clearance, you can reach out to the bank. In order to process your loan, the bank will require a Detailed Project Report that will consist of every detail of your business, your business projections, your product, marketing strategy, financial estimations and projections, etc. Depending on the type of loan requirement, bank will analyse, investigate, verify and assess the reports and details to process and approve your loan applications.
What are the things to remember while applying for a startup loan?
- Either or your business partner should have no default reference in your CIBIL.
- You should have a certain percentage of funds invested in your business, the bank will take care of the rest.
- These loans require a collateral security since the amount is huge and firm is a new to the industry.
Your loan application has to be as per the bank requirements and structures. It is advisable to get your proposals prepared professionally for any kind of posed risks or rejections. Already the bank loan processes are cumbersome and stretched therefore, it is preferred to hit at the right point at once so that you get the required approvals on time. There are certain other schemes that can be relevant and follow easier processes. Look for the best options and grab your best.