A Startup India Seed Fund Scheme(SISFS) was unveiled by union commerce minister, Piyush Goyal this Monday. The prime objective of the scheme is to provide adequate financial support to startups that are in their early stage across 300 incubation centers. The plan was announced by the Centre almost three months ago.
The commerce ministry expects the funds to be beneficial to around 3600 startups, in addition to providing a speed boost to the startup ecosystem, especially in tier-2 and 3 cities. The main objective of the fund is to provide adequate financial assistance and support to startups, helping them with prototype development, proof of concept, product trials, and entry to the market. The government has allocated a total amount of Rs.945 crore for the fund
According to union commerce minister Piyush Goyal,
“SISFS will secure seed funding, inspire innovation, support transformative ideas, facilitate implementation, and start a startup revolution.”
He also added that the scheme will facilitate the creation of a robust startup ecosystem especially in non-metros that often lack adequate funding. The minister also mentioned that he expects the scheme to be the catalyst that will bring forth innovators, particularly from rural areas.
Eligible incubators chosen by an expert committee will receive grants of up to Rs.5 crore. Grants of up to Rs.20 lakh will be offered to them to facilitate the validation of the proof of concept, prototype development, etc. In addition to this, startups will also receive investments of up to Rs.50 lakh that will help them in market entry and commercialization.
Though the nation is going through a rather tough phase, the government intends to work with a strong resolve to empower startups.
At the Startup India’s international summit, ‘Parambh’ in January, Prime minister, Narendra Modi had mentioned that the government is working “to create a startup system, which is based on the mantra, ‘of the youth, by the youth, for the youth.”
According to the commerce ministry, the scheme will back the incubators to apply for funds with the help of an online platform. The scheme will also be monitored and executed by a specially formed expert committee.