Startup India Seed Fund Scheme
GS PAPER III: Indian Economy and issues relating to planning, mobilization, of resources, growth, development and employment.
Context: The Startup India Seed Fund Scheme launched.
- 3,600 startups are expected to benefit from the scheme asthis scheme will
- Secure seed funding
- Inspire innovation
- Support transformative ideas
- Facilitate implementation, and
- Start startup revolution
Startup India Seed Fund Scheme (SISFS)
- It aims to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry, and commercialization.
- 945 Crore corpus will be divided over the next 4 years for providing seed funding to eligible startups through eligible incubators across India.
- This scheme will create a robust startup ecosystem, particularly in Tier 2 and Tier 3 towns of India, which are often deprived of adequate funding.
- It would especially encourage innovators from rural areas to come forward and benefit from this scheme.
- It will act as a bridge between ideas and their implementation.
- Independent & ambitious thinking in the Startup ecosystem will encourage entrepreneurship and create a culture that will recognise innovation.
- With the motto of Connect, Collaborate & Catalyse, the Government has introduced initiatives like Startup Innovation Challenges, National Startup Awards, Ranking of States, SCO Startup Forum, Prarambh etc.
- The online portal created by DPIIT, for the scheme, will allow incubators to apply for funds under it.
- An Experts Advisory Committee (EAC) has been created by DPIIT to execute and monitor the Startup India Seed Fund Scheme.
- Grants of upto Rs 5 Crores shall be provided to the eligible incubators selected by the EAC.
- The selected incubators shall provide grants of up to Rs 20 lakhs for validation of Proof of Concept, or prototype development, or product trials to startups.
- Furthermore, investments of up to Rs 50 lakhs shall be provided to the startups for market entry, commercialization, or scaling up through convertible debentures or debt-linked instruments.
The promising startups that are supported at their early stages shall create huge employment opportunities for everyone. The Seed Fund Scheme also envisions to promote virtual incubation for startups by enabling 300 incubators to support startups from all corners of the country. The impact of this will be visible by the spur of innovations in tier 2 and tier 3 regions of India.
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