The Startup India Seed Fund Scheme (SISFS) is a government program announced on January 16, 2021, and launched on April 19, 2021. It helps new businesses get money when they are just starting out.
The scheme provides up to ₹50lakh to eligible startups through selected business incubators.
The government has set aside ₹945 crore for this program from 2021 to 2025, aiming to support 3,600 entrepreneurs through 300 incubators across India.
The Department for Promotion of Industry and Internal Trade (DPIIT) runs this program.
It provides financial support during the early stages, including funding for testing ideas, developing initial products, and selling them to customers. This helps startups succeed during their vulnerable early phase.
Objectives of the Startup India Seed Scheme
This scheme helps new businesses get the money they need to start and grow. It supports individuals with innovative business ideas who aim to create jobs and contribute to the economy.
1. Bridge Funding Gap
Many people have great business ideas, but lack the funds to turn them into viable companies. Banks often don’t give loans to new businesses because they think it’s too risky.
This scheme fills that gap by providing startups with the money they need most. It helps business owners transition from concept to reality by selling their products or services.
2. Provide Seed Capital
The scheme gives money to new businesses in two ways. First, it can provide up to Rs 20 lakhs as a grant, meaning the business doesn’t have to repay it.
Second, it can provide up to Rs 50 lakhs in debt or convertible debentures, which the business will need to repay later. This money helps startups buy equipment, hire people, and cover other costs needed to start their business.
3. Support Innovation
The scheme seeks businesses with innovative and creative technology-driven ideas. It aims to support companies that can expand significantly and serve a large customer base across various locations.
These businesses should solve real problems in new ways and have the potential to expand quickly using digital tools and modern technology.
4. Promote Key Sectors
The scheme focuses on important areas that help society. It supports businesses in healthcare that make people healthier, farming businesses that help grow more food, and education companies that help people learn better.
It also helps businesses that provide financial services to people without bank accounts and energy companies that offer clean power.
5. Create Jobs
When new businesses start and grow, they create jobs for many people. This scheme helps entrepreneurs start companies that will hire workers and contribute to the country’s economy.
More businesses mean more jobs, more tax money for the government, and a stronger economy for everyone.
Startup Eligibility Made Simple
Want to know if your startup qualifies? Check these basic rules first. These criteria help decide which startups can apply for support and funding.
| What You Need | Details |
|---|---|
| Government Recognition | Your startup must be approved by DPIIT (a government department) |
| Company Age | Started within the last 2 years only |
| Good Business Idea | Your idea should work in the real market and can grow big |
| Uses Technology | Must use tech in your product, service, or how you do business |
| Helps Society | Extra points if your startup solves social problems or works in tough areas |
These rules ensure only serious, tech-focused startups with real potential get selected. Meeting all criteria improves your chances of getting support.
Note: DPIIT stands for Department for Promotion of Industry and Internal Trade – the government body that certifies startups in India.
Application Process and How Startups Can Apply
Getting startup funding in India involves several important steps. The government has made the process largely online to help new businesses access funding and support.
Step 1: Register Your Business Entity First
You must register your business as a Private Limited Company, LLP, or Partnership Firm. Visit the Registrar of Companies or Registrar of Firms with the required documents and fees.
Get your Certificate of Incorporation and PAN card ready. This legal registration must happen before applying to Startup India.
Step 2: Create an Account on the Startup India Portal
Visit the Startup India website and click on the ‘Register‘ button. Click on “Register“, and it will redirect to the Bhaskar portal, where you need to complete the form with details.
Enter your name, email, phone number, and create a password. Verify your email with the OTP they sent you.
Step 3: Complete Your Startup Profile
Fill in all details about your startup after logging in. Include your business type, industry, and development stage.
Complete your profile by providing details about your startup, such as its business nature, industry, and stage of development. Make sure all information matches your official business documents.
Step 4: Apply for DPIIT Recognition
Click on the ‘Apply for DPIIT Recognition‘ option under the ‘Recognition‘ tab. This step is crucial for obtaining startup benefits.
It will redirect to the National Single Window System (NSWS) website. Fill out the detailed recognition form with your business information.
Step 5: Fill the Startup Recognition Form
On the ‘Startup Recognition Form‘, you need to fill in the details such as the entity details, full address (office), authorised representative details, and directors/partners details.
Include your startup activities and innovation details. Self-certify that your startup meets all government requirements.
Step 6: Upload Required Documents
Submit the incorporation certificate, PAN card, and business registration papers. Upload details about any funding you have received.
Include income tax returns if your business is already running. Make sure all documents are clear and readable.
Step 7: Submit Application and Wait for Review
After entering all the sections of the ‘Startup Recognition Form‘, accept the terms and conditions, and click on the ‘Submit‘ button.
The government will review your application for DPIIT recognition. The DPIIT certificate is usually issued within a few weeks after submitting the complete application.
Step 8: Get a Recognition Certificate
Once the application is complete and the startup gets recognised, you will receive a system-generated certificate of recognition.
You can download this certificate from the portal. This certificate proves your startup is officially recognized by the government.
Step 9: Apply to Incubators and Programs
After getting DPIIT recognition, you can apply to multiple incubators. Search for incubators that match your business type.
Submit your detailed project plans and milestones to each one. You can apply to several incubators at the same time.
Step 10: Access Benefits and Maintain Compliance
Start using startup benefits like tax exemptions and fast patent processing. Keep your portal profile updated with any business changes.
Ensure timely filing of GST, income tax, and other applicable returns. Stay compliant with all government rules to keep your benefits.
Startup India Seed Fund Scheme Benefits
The Startup India Seed Fund helps new businesses get money and support to grow. This government program makes it easier for startups to succeed.
- Easy Money Access – Get funds quickly for building your first product and testing it with customers
- Step-by-Step Funding – Receive money based on your progress milestones as you develop your business idea
- Expert Guidance – Connect with mentors and networks through incubators who help you grow faster
- Better Reputation – Having this fund makes investors trust you more for future funding rounds
- Work from Anywhere – Access support across India without visiting physical incubation centers regularly
This scheme gives startups the foundation they need to build successful businesses. It’s a great first step for any new entrepreneur.
Recent Updates and Budget Allocation
The government has allocated Rs 945crore over 4 years, starting from 2021-22, to support startups.
This money helps new businesses get started by giving them seed funding. In recent years, the government has increased the budget to help more startups secure funding.
They also introduced a new Credit Guarantee Scheme, which enables startups to secure loans without needing to provide collateral.
This means new businesses can get money more easily to start their companies. The government is spending more money each year to support entrepreneurs and help them build successful businesses.
Conclusion
The Startup India Seed Fund Scheme is helping thousands of new businesses get started across India. With Rs945 crore in funding, the government is supporting 3,600 entrepreneurs through 300 incubators.
This program makes it easier for people with good ideas to start companies in important areas like healthcare, farming, and technology.
The scheme provides money, guidance, and removes barriers that stop new businesses from growing. As more startups succeed, they create jobs and help India’s economy grow stronger.
This government support is building a better future where more people can start their own businesses and contribute to the country’s development.
