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To provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialization. This would enable these startups to graduate to a level where they will be able to raise investments from angel investors or venture capitalists, or seek loans from commercial banks or financial institutions.


Eligibility for Startups:

Every DPIIT-recognised startup who meets the following criteria:

o It must not be more than two years old and must not have received more than Rs 10 lakh of monetary support (excluding prize money) from the central/ state governments.

o They are expected to have a business idea to develop a product or a service with market fit, viable commercialisation, and scope of scaling with technology as the core.

o Preference to startups in sectors like social impact, waste management, water management, financial inclusion, education, agriculture, food-processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles, among others.

Eligibility for Incubators:

o Incubator must be a legal entity (a society, a trust, private limited company, or a statutory body).

o It should have been operational for at least two years on the date of application to the scheme.

o It must have facilities to seat at least 25 individuals.

o It must have at least 5 startups undergoing incubation physically on the date of application.


To build a strong eco-system for nurturing innovation and startups in the country.

The scheme was announced at ‘Prarambh: Startup India International summit. Rs.945 crore Seed Fund will be disbursed to eligible startups through eligible incubators across India in 2021-25.

An Experts Advisory Committee (EAC) will be constituted by the Department for Promotion of Industry and Internal Trade (DPIIT) for the overall execution and monitoring of the scheme.

Start-ups can avail up to ₹70 lakh:

o Up to Rs. 20 Lakhs as grant for validation of Proof of Concept, or prototype development, or product trials

o Up to Rs. 50 Lakhs of investment for market entry, commercialization, or scaling up through convertible debentures or debt or debt-linked instruments

Incubators would get up to ₹5 crore as grant:

o The grant should be utilized fully by the incubator within a period of three years from the date of receipt of the first installment of funds.

o If the Incubator has not utilized at least 50% of the total commitment within the first 2 years, then the Incubator will not be eligible for any further drawdowns.

India is home to the world’s third largest startup ecosystem which has helped several budding entrepreneurs to come up with innovative technologies and become big corporations.

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