What is the start-up India scheme?
The Start-up India came into effect on 16th January 2016, to reduce the unemployment rate of India, which has increased to 7.6% from 4% between the years 2017 and 2019. The Start-up India scheme is an initiative by the Government of India to provide affordable business finance to the entrepreneurs of the country. The scheme provides subsidised loan amounts of Rs. 10 lakh to Rs. 1 crore to women entrepreneurs and entrepreneurs from SC and ST communities.
Step-by-step startup India registration process
Registering for Startup India involves several steps. Here's a detailed guide:
- Eligibility Check: Eligibility check affirms that your startup is incorporated in India, less than ten years old, and has an annual turnover not exceeding INR 100 crore.
- Registration on Startup India Portal: Register your startup on the Startup India portal, complete the application form, and self-certify your compliance with environmental and labour laws.
- Application Form: The application form requires attentive completion, providing accurate business details.
- Self-Certification: Self-certification is a significant part of the process, where the startup needs to self-certify that they are following certain environmental and labour laws.
- Recognition Number: Following successful registration, the startup will be issued a unique recognition number. Do keep a note of this for future use.
- Regular Compliance: Beyond these steps, startups need to maintain regular compliance with the Indian Companies Act of 2013.
- Accessing Benefits and Services: Through the Startup India portal, one can avail several benefits such as networking opportunities, free learning programs, and access to government schemes and venture funds for additional support.
Features and benefits of the start-up India scheme
- The scheme simplifies the entire business registration process for start-ups.
- Self-certification reduces regulatory compliance costs for new businesses.
- The government offers low-cost legal support for faster patent processing.
- A dedicated fund of Rs. 2,500 Crore has been set up, with a target of Rs. 10,000 Crore over the next 4 years.
- A credit guarantee scheme is available to assist start-ups in securing funding.
- Start-ups benefit from capital gains tax exemptions.
- The scheme provides various tax incentives for eligible start-ups.
- It promotes innovation in biotechnology and encourages related entrepreneurship.
- Public procurement norms are made more flexible for start-ups.
- A legal advisory panel is available to assist with issues such as patent filing and other legal concerns.
Eligibility criteria of the start-up India scheme
- The entity must be a private limited company or a limited liability partnership (LLP).
- The organisation must be recognised by the Department of Industrial Policy and Promotion (DIPP).
- A letter of recommendation is required for approval.
- The company should offer innovative ideas, products, or services.
- The business must be newly established or not older than five years.
- The annual turnover of the company should not exceed Rs. 25 crore.
- The company should not result from the closure or restructuring of an existing business.
In addition to the above, you will require a patron guarantee from a trademark office and an Indian patent and approval from the Department of Industrial Policy and Promotion (DIPP). If your firm specialises in providing fund and equity services, it should be registered under the Securities and Exchange Board of India (SEBI). Also, your firm should hold attractive policies and products.
If you fail to match all the criteria mentioned above, you can apply for finance solutions that come at low interest rates. Bajaj Finserv provides Loans Against Property that you can avail of after meeting the minimum eligibility criteria. You get ample funds up to Rs. 10.50 crore* and a long tenor to make your EMIs affordable.
Required documents for start-up India scheme
- Incorporation certificate: Proof of the company’s legal formation (e.g., Private Limited, LLP, or Partnership).
- PAN card: A copy of the company’s Permanent Account Number (PAN).
- GST registration: For businesses engaging in the sale of goods or services.
- Proof of concept: A brief description or pitch of the innovative idea or product.
- Founder’s details: Identification proof (e.g., Aadhaar, Passport) and photographs of all founders.
- Bank account details: A copy of the company’s bank statement or account.
- Business plan: Outline of business strategy, goals, and market research.
- Self-certification: Certification of compliance with government regulations.
How to Register for Startup India Scheme?
Registering for the Startup India Scheme involves several steps, and it is designed to promote and support startups in India. Here is a general guide on how to register for the Startup India Scheme:
- Eligibility check: Ensure that your startup meets the eligibility criteria set by the Startup India Scheme. Generally, your startup should be incorporated as a private limited company, a partnership firm, or a limited liability partnership. Also, it should be less than 10 years old and have an annual turnover not exceeding ₹100 crores in any preceding financial year.
- Document preparation: Gather the necessary documents required for registration. These may include:
- Certificate of incorporation/registration
- Memorandum of Association (MoA) and Articles of Association (AoA)
- Details of Directors/Partners
- PAN card and Aadhaar card of Directors/Partners
- Description of the business idea and its innovation quotient
- Letter of Recommendation/Support (if any)
- Visit the Startup India Portal: Go to the Startup India official website and navigate to the registration section.
- Fill the Form: Fill out the online registration form with accurate details about your startup, including your business idea, details of founders, and other relevant information.
- Upload documents: Upload the required documents as per the specifications provided on the portal. Ensure that all documents are clear and legible.
- Self-certification: Self-certify that your startup meets the eligibility criteria and complies with the definition of a startup as per the Startup India Scheme.
- Submit application: After filling out the form and uploading the documents, submit your application through the Startup India portal.
- Review and approval: Your application will be reviewed by the Startup India team. If everything is in order and your startup meets the eligibility criteria, your application will be approved.
- Certificate of recognition: Once your application is approved, you will receive a Certificate of recognition from the Startup India Scheme, which provides various benefits and support to startups.
- Avail benefits: After receiving the certificate of recognition, you can avail of various benefits and support services provided by the Startup India Scheme, such as tax benefits, funding support, and access to networking opportunities.
It is essential to follow the guidelines and provide accurate information during the registration process to ensure a smooth application process. If you encounter any difficulties or have specific questions, you can reach out to the Startup India helpline or contact their support team for assistance.
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Frequently Asked Questions
The Stand-Up India scheme is an initiative launched by the Government of India to promote entrepreneurship among women, Scheduled Castes (SCs), and Scheduled Tribes (STs).
The Stand-Up India scheme was launched on April 5, 2016, by the Prime Minister of India, Narendra Modi. The scheme was introduced as part of the government's broader efforts to promote entrepreneurship and financial inclusion among women, Scheduled Castes (SCs), and Scheduled Tribes (STs).
The Stand-Up India scheme provides financial support to entrepreneurs, focusing on women, Scheduled Castes (SCs), and Scheduled Tribes (STs). It offers loans for establishing new ventures, with benefits such as access to finance, margin money support, interest rate subsidies, an extended repayment period, and a focus on skill development.
The Startup India scheme is open to all Indian entrepreneurs who aim to develop and sell products or services that are innovative and driven by technology or intellectual property. Both new and existing companies can register if they are less than five years old and their annual turnover is less than INR 100 crores.
There are several ways to secure funding for your startup. You may opt for venture capital or angel investment, business loans from banks, crowd funding or apply for government schemes like the Startup India initiative. Before you approach investors or lenders, ensure you have a well-structured business plan and a promising revenue model.
Registering with Startup India offers numerous benefits including tax exemptions for three consecutive financial years, access to high-quality intellectual property services and facilitators, easy access to funding, a faster exit mechanism if required, and an easy public procurement process.
In India, a company is referred to as a startup if it is up to ten years from the date of incorporation. Also, the entity should not have an annual turnover exceeding INR 100 crores in any of the financial years since its registration.
The registration cost for a startup in India is quite reasonable. The incorporation of a private limited company would cost in the range of INR 9,000 to INR 12,000. However, under the Startup India initiative, startups are eligible for a free of cost recognition and can enjoy benefits like intellectual property rights protection and easier compliance.
The three pillars of Startup India are Simplification and Handholding, Funding Support and Incentives, and Industry-Academia Partnership and Incubation. Simplification and Handholding are aimed at facilitating easy setup and operation for startups. This includes services like Fast track patent examination and legal support. Funding Support and Incentives focus on providing funding for startups and offering incentives to entrepreneurs to encourage more startups. The industry-academia Partnership and Incubation aim to foster a culture of innovation in the nation by offering mentorship, nurture innovation, and provide cutting-edge technology parsing and business scaling support.
In terms of funding under the Startup India scheme, it varies immensely based upon the scale, nature, and prospective potential of the startup business in question. The government has set aside Rs. 10,000 crores for funding startups over a four-year period. This fund is managed by the Small Industries Development Bank of India (SIDBI). The funds are dispersed after scrutiny of the individual business model, its feasibility, and growth potential.
For the most part, enrolling in the Startup India Scheme is free of charge. However, whilst accessing certain benefits such as Legal Support, Fast track patent examination, or obtaining funds might incorporate certain costs or fees. The overall aim is to provide a platform that fosters entrepreneurship by reducing regulatory burdens and encouraging business growth.
The Startup India initiative provides an excellent opportunity for a variety of startups. Regardless of whether you fall under technology, manufacturing, healthcare, agriculture, education, or other sectors, you can find support under the Startup India scheme. The primary requirement is that your business should be innovative and have a high potential for employment generation or wealth creation. Your startup must also be registered in India and should not be more than ten years old from the date of registration.
