Startups are a crucial part of a country’s economy, especially in today’s global scenario. Consumer choices and product variety have increased significantly, and the demands and needs of consumers are increasing day by day. To facilitate consumer services and accelerate the economic growth of the country, promoting startups is essential.
However, the startups in the country were facing financial issues since asset building requires capital. Banks do not issue loans merely against plans of a business, and neither do angel investors invest without seeing an actual foundation of a company. The government of India introduced the Startup India seed fund scheme to solve this issue.
Read the article to learn more about the govt scheme for startups, ranging from its meaning and benefits to its Startup India Seed Fund Scheme eligibility criteria and answers to popular questions, like ‘How to apply for Startup India Seed Fund Scheme?’.
Overview
The table below summarises some key details about the Startup India Seed Fund Scheme government that one should know.
| Name of the scheme | Startup India Seed Fund Scheme |
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| Startup India Seed Fund Scheme launch date | 19th April, 2021 |
| Objectives | To provide financial assistance to startups that have just begun their operations or do not have proper assets |
| Startup India Seed Fund Scheme amount | Rs. 20 Lakhs for validation of Proof of Concept and up to Rs. 50 lakhs for market entry |
| Mode of application | Online |
Read More: Startup India Initiative
What Is Startup Seed Fund Scheme?
The Startup India Seed Fund Scheme (SISFS) is a sub-scheme under the Startup India initiative, aiming to provide financial assistance to startups that have just begun operations or lack proper assets. This startup government scheme was launched on April 19, 2021, by the Department for Promotion of Industry and Internal Trade (DPIIT), under the Ministry of Commerce and Industry.
The govt scheme has a huge outlay, which shall be used to give financial help to eligible startups. This help shall be extended based on Proof of Concept, prototype development, product trials, market entry, and commercialisation. This govt scheme will entitle startups to build their foundation and reach a point where they can attract angel investments.
The financial assistance is provided to beneficiaries through incubators, govt or non-govt recognised.
Objectives Of The Startup India Seed Fund Scheme
There are several objectives of the govt startup scheme that make it unique, some of which are laid down below in brief points for one's reference:
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The primary objective of the Startup India Seed Fund Scheme government is to help startups and young entrepreneurs in filling the gap between innovative ideas and a practical and tangible solution.
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The govt scheme provides its support to startups in various forms, such as financial aid, so that startups can be freed from the major issue of insufficient funds or capital, which is one of the biggest hindrances when it comes to turning ideas into viable business models.
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The govt scheme provides funding to eligible and approved startups at crucial points for various activities, such as building prototypes, conducting product trials, and other such checks needed before rolling the product out in the market and for inviting investors.
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The govt scheme for startups also aims to reduce the dependence of startups on private sector banks and other such private establishments that provide loans, as the interest rates and terms of loans are extremely rigid. Under this scheme, the government provides funding to the startups with better terms and conditions, as it is crucial for the startups' survival.
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The Startup India Seed Fund Scheme government also provides a way for startups to network with the right people and grab investment opportunities. This ultimately not only aids in the development and growth of a startup but also contributes to other components, like employment generation, which contributes to the nation's development.
Read More: Mukhyamantri Udyami Scheme (मुख्यमंत्री उद्यमी योजना) Updates
What Are The Benefits Of The Startup India Seed Fund Scheme?
The SISFS govt scheme has multiple benefits for its beneficiaries and the nation as a whole. Let us look at some of the major benefits of the govt scheme:
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Rolling Applications: The applications for the SISFS scheme are open for the entire year, and interested startups can apply anytime in the year. It is not time-barred.
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Sector Agnostic: The scheme accepts applications for startups from every sector, irrespective of the activity they are engaged in. Thus, entrepreneurs do not have to worry about their field for seeking assistance under this Sarkari scheme.
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PAN-India: The scheme is applicable all across India and startups from all parts of the country can apply to seek help under this scheme.
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Startup India Seed Fund Scheme amount: The scheme provides up to Rs. 20 Lakhs for validation of Proof of Concept, prototype development, or product trials, and up to Rs. 50 lakhs for market entry, commercialisation, or scaling up through convertible debentures, debt, or debt-linked instruments.
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Milestone-Based Payments: The assistance is granted to Startups based on ‘milestones’. After a startup achieves success in one of the activities it needs assistance for, the assistance for the next step shall be provided after that.
What Is The Eligibility Criteria For Startup India Seed Fund Scheme?
The eligibility criteria to avail the benefits of the Startup India Seed Fund Scheme have a broad scope and can include multiple businesses/startups under its ambit. Let us have a glance at the Startup India Seed Fund Scheme eligibility conditions:
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Must be recognised by DPIIT.
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Must not have been incorporated more than 2 years from the date of application.
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Must have a business idea to develop a product or a service with market fit, viable commercialisation, and scope of scaling.
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The startup should not have received more than ₹10 lakhs of financial assistance under any other Central or State Government scheme.
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Shareholding by Indian promoters in the startup should be at least 51% at the time of application to the incubator for the scheme, as per the Companies Act, 2013, and SEBI (ICDR) Regulations, 2018.
Read More: USKP Loan To Start Your Business In West Bengal!
How To Apply For Startup India Seed Fund Scheme?
The application procedure to avail the benefits of the Startup India Seed Fund Scheme government is simple and is given below in a stepwise manner for one's better understanding:
Step 1: Make sure you meet the eligibility conditions.
Step 2: Please visit the official website of the Startup India Seed Fund Scheme here.
Step 3: Click on the ‘Apply Now’ tab.
Step 4: Fill in the requisite details and upload the relevant documents associated with the company.
Step 5: Recheck the filled details and ensure they are accurate and correct, then save and submit your form.
Step 6: You will receive a confirmation if you are shortlisted to avail the benefits of the govt startup scheme.
What Are The Documents Required For The Startup India Seed Fund Scheme?
Applicants need to submit some supporting documents to successfully apply for the govt scheme as mentioned in the Startup India Seed Fund Scheme pdf. The list of those documents is as follows:
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Registration or incorporation certificate of one's business unit
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Detailed business plan or proposal
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Proof of concept
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Identity proof, like an Aadhaar card, of the founder
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Bank account details
Also Read: Top 10 Government Schemes For Entrepreneurs & Startups In India In 2026
Conclusion
The Startup India Seed Fund Scheme is a positive measure for helping startups realise their complete potential. The scheme provides support in various forms, especially financial aid at crucial times for startups. The govt scheme focuses on the key aspects that contribute to the growth of a startup. i.e., innovation, ideation, and market readiness.
With the growth of startups, investment and job opportunities will also increase in the country, and that's one of the other aims of the govt that is to be fulfilled through this scheme. The government startup scheme is helping entrepreneurs turn their innovative ideas into reality and resolve the everyday problems faced by the people of India.
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