STAND UP INDIA SCHEME

Objectives

It aims at promoting entrepreneurship among women and scheduled castes and tribes.

Beneficiaries:

SC/ST and/or woman entrepreneur, above 18 years of age.

Salient features

  • It facilitates bank loans between Rs 10 lakh and Rs 1 Crore to at least one Scheduled Caste (SC) or Scheduled Tribe (ST) borrower and at least one woman borrower per bank branch for setting up a greenfield enterprise. This enterprise may be in manufacturing, services or the trading sector.
  • In case of non-individual enterprises at least 51% of the shareholding and controlling stake should be held by either an SC/ST or woman entrepreneur.
  • Borrower should not be in default to any bank/financial institution.
  • It covers all Scheduled Commercial banks.
  • Borrower shall be required to bring in minimum of 10% of the project cost as own contribution.
  • The rate of interest would be lowest applicable rate of the bank for that category (rating category) not to exceed (base rate (MCLR) + 3%+ tenor premium).
  • Provision of handholding support is available under the scheme, in case borrower is a Trainee Borrower. The offices of SIDBI and NABARD are designated as Stand-up Connect Centres, who will arrange for the support required. SIDBI is a refinancing agency.
  • Besides primary security, the loan may be secured by collateral security or guarantee of Credit Guarantee Fund Scheme for Stand-Up India Loans (CGFSIL) as decided by the banks.
  • The loan is repayable in 7 years with a maximum moratorium period of 18 months.
  • It also provides for Creation of a credit guarantee mechanism through the National Credit Guarantee trustee Company (NCGTC)

A proper thorough research needs to be done and studies as to measure its impact. On paper, it looks good that the young entrepreneurs will get incentives or loan at low interest rate. They are also provided with legal, technical and expert advices. Its success and advantage must be correlated with the Make in India scheme.

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