Stand-Up India Scheme

Stand-Up India Scheme

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The Stand-Up India program's objective is to make it easier for banks to provide loans of up to Rs. 10 lakhs and Rs.1 crore to borrowers of Scheduled Caste (SC) or Scheduled Tribe (ST) origin, and at least one woman borrower per bank branch for the establishment of a new business. This business can be in the manufacturing, service, agribusiness, or trading sectors. For non-individual businesses, at least 51 percent of the shareholding and controlling stake must be held by a woman or a SC/ST entrepreneur.

1. Eligibility: SC/ST and/or female business owners over the age of 18

2. The scheme only offers loans to Greenfield projects. In this context, "green field" refers to the beneficiary's first venture in the manufacturing, services, agri-allied activities, or trading sectors.

3. SC/ST and/or Women Entrepreneurs should hold 51% of the shareholding and controlling stake in non-individual businesses.

4. The borrower should not default on any financial obligations.

The purpose of the loan is to assist SC/ST/Women entrepreneurs in starting a new business in the manufacturing, services, agri-allied activities, or trading sectors. The nature of the loan is a composite loan that includes both a term loan and working capital and ranges from Rs 10 lakh to Rs. 1 crore.

Size of Loan - A composite loan equal to 85% of the project's cost, including working capital and a term loan. If the borrower's contribution in addition to convergence support from any other schemes exceeds 15% of the project cost, the requirement that the loan cover 85% of the cost would not apply.

Interest Rate - The interest rate would be the bank's lowest applicable rate for that rating category, capped at base rate (MCLR) + 3%+ tenor premium.

Security - Depending on the decision made by the banks, the loan may be secured by collateral security or a guarantee from the CGFSL or, the Credit Guarantee Fund Scheme for Stand-Up India Loans.

Repayment - The loan can be paid off in seven years, with a maximum 18-month moratorium. Working Capital: An overdraft may be approved for working capital withdrawals of up to Rs 10 lakh.For the borrower's convenience; debit and credit cards will be issued. In addition, a working capital limit of Rs.A cash credit limit of 10 lakh is required for approval.

Margin Money - The plan calls for 15 percent margin money, which can be given in conjunction with other eligible Central and State programs. These plans can be used to get subsidies or meet margin money requirements, but the borrower must always contribute at least 10% of the project's cost as their own money.

In conclusion, it is important to be aware that this Stand-up Indian program would be implemented by all of the country's scheduled commercial bank branches.