Each year, the contribution of Indian startups and MSMEs to the Indian economy is increasing significantly. There are about 6.3 crore MSMEs in India, contributing about 29 per cent to the Indian GDP.
Providing employment opportunities to many, government-registered Indian startups have created up to 6.5 lakh jobs in the country. And to help MSMEs and startups grow, the Indian government has launched numerous schemes providing several benefits, including funding assistance.
In this article, you will get to know about several government schemes helping MSMEs and startups grow.
Following are the top 5 government schemes helping Indian MSMEs and startups in their business journey.
1. Support for International Patent Protection in Electronics and & Information Technology (SIP-EIT)
This scheme provides financial support to MSMEs and Technology Startup units for international patent filing.
SIP-EIT aims to encourage innovation and recognize the value and capabilities of global IP along with capturing growth opportunities in the ICTE sector.
Under this scheme, reimbursement of expenses is limited to the lower cost of the following :
- Rs. 15 lakhs per invention or
- 50% of the total expenditures incurred.
2. Venture Capital by SIDBI Venture Capital Ltd.(SVCL)
SIDBI Venture Capital Limited (SVCL) is an investment management company and a wholly-owned subsidiary of SIDBI that invests in companies engaged in a wide range of growth sectors in the MSME sector. These sectors include food processing, life sciences, healthcare, retailing, light engineering, information technology, infrastructure-related services, logistics and distribution, etc.
3. Pradhan Mantri Mudra Yojana
Launched by PM Modi in April 2015, Pradhan Mantri Mudra Yojana aims to empower Indian entrepreneurs by providing them loans up to Rs 10 lakh.
You can approach any of the lending institutions mentioned above or apply online . Herein, loan schemes are classified into three main categories:
- SHISHU Loan (loans up to Rs. 50,000 can be availed under the Mudra Shishu Loan scheme).
- KISHOR Loan (loans ranging from Rs. 50,001 to Rs. 5,00,000 can be availed by existing enterprises for buying equipment, new machinery or raw materials under the Kishor Loan Scheme).
- TARUN Loan (established businesses and enterprises can avail of loans ranging from Rs. 500,001 to Rs. 10,00,000 under the Tarun Loan Scheme).
In FY 2021-2022, 53795526 PMMY Loans and Rs 339110.35 Crore has been sanctioned.
4. Raw Material Assistance Scheme
This scheme aims at supporting startups and MSMEs by helping them finance the purchase of raw materials (both indigenous & imported).
5. Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTSME)
Ministry of Micro, Small & Medium Enterprises (MSME), Government of India and Small Industries Development Bank of India (SIDBI) jointly set up the CGTMSE to provide a collateral-free loan and catalyse the flow of institutional credit to MSEs.
The loan disbursal limit under CGTMSE is Rs 2 crore. In FY22, over 7 lakh guarantees got approved, the second-highest in eight years, as per government data.