The Stand-Up India Scheme is a flagship initiative launched by the Government of India (Ministry of Finance) designed to promote entrepreneurship at the grassroots level. It specifically focuses on the economic empowerment of women and Scheduled Caste (SC) / Scheduled Tribe (ST) communities by helping them overcome financial barriers to starting a business.
1. Core Objective
The primary goal is to leverage the vast network of bank branches to institutionalize credit. The scheme mandates every bank branch of all Scheduled Commercial Banks to extend a loan to:
At least one Scheduled Caste (SC) or Scheduled Tribe (ST) borrower, and at least one Woman borrower, for setting up a Greenfield enterprise.
2. Key Features of the Loan
The financial support provided under this scheme comes with structured flexibilities to ensure the business can comfortably sustain its early phases:
Loan Quantum
Composite loans (inclusive of term loan and working capital) ranging from ₹10 Lakh to ₹1 Crore.
Purpose
Financing up to 85% of the total project cost.
Interest Rate
Kept highly competitive — the lowest applicable rate of the bank for that specific rating category, not exceeding Base Rate (MCLR) + 3% + Tenor Premium.
Repayment Period
Repayable over a flexible tenure of up to 7 years, including a maximum moratorium period of 18 months (during which principal repayment isn’t mandatory).
Working Capital Support
Requirements up to ₹10 Lakh are sanctioned via an overdraft facility (accessible via a RuPay Debit Card). Amounts above ₹10 Lakh are sanctioned via Cash Credit limits.
Security / Collateral
Besides primary security (like assets created by the loan), the loan can be secured through collateral or the Credit Guarantee Fund Scheme for Stand-Up India Loans (CGFSIL), making it easier for individuals without personal property to get approved.
3. Eligibility Criteria
To apply for a loan under the Stand-Up India scheme, applicants must fulfill the following:
Target Groups
Must be a Woman and/or belong to the SC/ST category.
Age
The entrepreneur must be at least 18 years old.
Type of Project
The loan is strictly available for Greenfield projects — it must be the applicant’s first-time venture in the manufacturing, services, trading sectors, or activities allied to agriculture (like dairy, poultry, pisciculture, etc.).
Ownership Stake
For Companies/Partnerships: if the business is not owned by a single individual, at least 51% of the shareholding and controlling stake must be held by either an SC/ST and/or a Woman entrepreneur.
Credit History
The borrower must not be a defaulter to any bank or financial institution.
4. Margin Money Requirement
While the loan covers up to 85% of the project cost, the scheme envisages a margin money requirement of up to 15%.
The borrower is expected to bring in a minimum of 10% of the project cost as their own contribution. The remaining amount can be covered in convergence with other eligible Central or State Government subsidy schemes to ease the upfront financial burden on the entrepreneur.
5. Handholding Support
Recognizing that many first-time business owners need more than just money, the government provides “Handholding Support” via the Small Industries Development Bank of India (SIDBI) and NABARD.
Financial and technical training.
Help with preparing a Detailed Project Report (DPR).
Guidance on sourcing raw materials, e-commerce registration, and bill discounting.
How to Apply
Eligible entrepreneurs can apply for the scheme through three primary channels:
Online Portal
Directly through the official Stand-Up Mitra portal at www.standupmitra.in
Bank Branches
By walking into any branch of a Scheduled Commercial Bank and asking for the Stand-Up India application.
Lead District Manager (LDM)
Through the designated LDM office in your district.