🚀 Stand Up India Scheme
Bank loans between ₹10 lakh to ₹1 crore for SC/ST and women entrepreneurs to set up greenfield enterprises.
Overview
The Stand-Up India Scheme was launched by the Ministry of Finance on 5th April 2016 to promote entrepreneurship at the grassroots level. It specifically targets underserved segments of society to help them become job creators rather than job seekers.
The core mission is to leverage the vast network of bank branches to provide institutional credit to Scheduled Caste (SC), Scheduled Tribe (ST), and Women entrepreneurs. This enables them to participate actively in the nation's economic growth.
Extension: The scheme has been officially extended and is operational up to 2025. The scheme will be reviewed and extended in the next budget.
Objective & Mandate
The scheme has a very specific mandate for every bank branch in the country. It facilitates bank loans between ₹10 Lakh and ₹1 Crore to at least:
- One SC or ST borrower, AND
- One Woman borrower
...per bank branch of all Scheduled Commercial Banks (SCBs). This ensures widespread coverage across India.
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Overview
The Stand-Up India Scheme was launched by the Ministry of Finance on 5th April 2016 to promote entrepreneurship at the grassroots level. It specifically targets underserved segments of society to help them become job creators rather than job seekers.
The core mission is to leverage the vast network of bank branches to provide institutional credit to Scheduled Caste (SC), Scheduled Tribe (ST), and Women entrepreneurs. This enables them to participate actively in the nation's economic growth.
Extension: The scheme has been officially extended and is operational up to 2025. The scheme will be reviewed and extended in the next budget.
Objective & Mandate
The scheme has a very specific mandate for every bank branch in the country. It facilitates bank loans between ₹10 Lakh and ₹1 Crore to at least:
- One SC or ST borrower, AND
- One Woman borrower
...per bank branch of all Scheduled Commercial Banks (SCBs). This ensures widespread coverage across India.
Target Activity
The loan is strictly for setting up a Greenfield Enterprise.
- Definition: "Greenfield" implies a brand new project where the applicant stands up a fresh business. It does not cover the expansion or modernization of existing businesses.
- Sectors: The enterprise can be in Manufacturing, Services, Agri-allied activities, or the Trading sector.
Eligibility Criteria
To qualify for a loan under this scheme, applicants must meet the following conditions:
| Criteria | Condition |
|---|---|
| Beneficiary | Must be an SC, ST, or Woman entrepreneur. |
| Age | Must be above 18 years of age. |
| Business Ownership | For non-individual enterprises (e.g., partnerships, private ltd), at least 51% of the shareholding and controlling stake must be held by either an SC/ST or a Woman entrepreneur. |
| Credit History | The borrower should not be in default to any bank or financial institution. |
Loan Features
The financial assistance provided is structured as follows:
Nature & Quantum
- Type: It is a Composite Loan, meaning it covers both Term Loan (for assets like machinery) and Working Capital (for day-to-day operations).
- Amount: Ranging from ₹10 Lakh to ₹1 Crore.
- Project Cost Coverage: The loan covers up to 85% of the project cost.
- Condition: The borrower is expected to bring in 15% as margin money. However, if a portion is covered by other state/central subsidy schemes, the borrower's contribution can be reduced, provided they bring in at least 10% of the project cost from their own funds.
Interest Rate
The interest rate is the lowest applicable rate of the bank for that category (rating category).
- Formula: It shall not exceed MCLR (Marginal Cost of Funds based Lending Rate) + 3% + Tenor Premium.
Security & Guarantee
- Primary Security: The assets created out of the loan (e.g., machinery, building).
- Collateral: Banks may ask for collateral security or a Third Party Guarantee.
- CGFSI Coverage: If collateral is not provided, the loan can be covered under the Credit Guarantee Fund for Stand-Up India (CGFSI).
Repayment Terms
The scheme offers flexible repayment options to ensure the business has time to stabilize:
- Tenure: The loan is repayable over 7 years.
- Moratorium: A moratorium period (holiday period where principal repayment is not required) of up to 18 months can be granted.
Support Ecosystem
The Stand-Up India Portal (www.standupmitra.in) acts as a digital marketplace providing end-to-end support based on three pillars:
- Handholding Support: Connecting borrowers with agencies that help in training, skill development, and mentorship.
- Information on Financing: Providing details on loan availability and facilitating applications.
- Credit Guarantee: ensuring access to the Credit Guarantee Scheme for those unable to provide collateral.
Key Points Summary
| Parameter | Details |
|---|---|
| Launch Date | 5th April 2016 |
| Loan Range | ₹10 Lakh – ₹1 Crore |
| Mandate | 1 SC/ST & 1 Woman borrower per branch |
| Enterprise Type | Greenfield (New) only |
| Margin Money | Min. 15% (can be reduced to 10% with subsidies) |
| Repayment | 7 Years + 18 months moratorium |
Summary Cheat Sheet
| Concept / Topic | Key Details / Explanation |
|---|---|
| Objective | Bank loans for SC/ST and Women entrepreneurs to set up Greenfield enterprises. |
| Launch Date | 5th April 2016 by Ministry of Finance. |
| Mandate | At least 1 SC/ST + 1 Woman borrower per bank branch of all SCBs. |
| Loan Range | ₹10 Lakh to ₹1 Crore (Composite Loan — Term + Working Capital). |
| Enterprise Type | Greenfield (New) only — Manufacturing, Services, Agri-allied, or Trading. |
| Age | Above 18 years. |
| Ownership (Non-Individual) | Min 51% shareholding by SC/ST or Woman entrepreneur. |
| Margin Money | Min 15% by borrower (can reduce to 10% with subsidies). |
| Interest Rate | Max MCLR + 3% + Tenor Premium. |
| Repayment Tenure | 7 Years with up to 18 months moratorium. |
| Guarantee | CGFSI (Credit Guarantee Fund for Stand-Up India) if no collateral. |
| Portal | standupmitra.in — digital marketplace for support. |
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