Difference Between Standup India And Startup India Schemes

Out of the numerous business support programs in India initiated by the government, the Start-up India and Stand-up India schemes have been two of the most pivotal. 

While both aim to encourage entrepreneurship, they cater to different segments and offer unique benefits. This article will cover the basics of both these Indian entrepreneurship initiatives and highlight the key differences between Start-up India and Stand-up India schemes.

What Is the Stand-Up India Scheme?

The Stand-up India program is a government initiative launched in 2016 to promote entrepreneurship among women and individuals from Scheduled Castes (SC) and Scheduled Tribes (ST) communities. This Indian enterprise initiative aims to facilitate loans ranging from INR 10 lakhs to INR 1 crore for setting up greenfield enterprises in manufacturing, services, or trading sectors. A greenfield enterprise is a newly established business operation that starts from scratch, without using any existing infrastructure or facilities. 

These loans can cover up to 85% of the project cost, with the remaining 15% to be contributed by the borrower. They are repayable over a period of up to 7 years, with a moratorium period of up to 18 months. Generally, borrowers can get the minimum applicable interest rates on the loan. 

The initiative not only provides financial assistance but also provides support for skill development, training, assistance with preparing project reports, and so on.

By helping beneficiaries become job creators rather than job seekers, the Stand-up India scheme promotes financial inclusion and economic as well as social growth. 

Eligibility for Stand-up India Scheme

The basic eligibility criteria for the Stand-up India scheme are:

• Women entrepreneurs and individuals from Scheduled Castes (SC) and Scheduled Tribes (ST) can apply.
• Applicants must be above 18 years of age.
• Applicants should not be defaulter with any financial institution.
• The scheme is only for a greenfield project in the manufacturing, services, or trading sector.
• Applicants must hold at least 51% of the shareholding and controlling stake for non-individual enterprises.

Please note that these criteria may change over time. It's advisable to check the latest guidelines on official government sources.

What Is the Start-up India Scheme?

The Start-up India scheme is a government initiative to encourage innovation and entrepreneurship across the country. This government scheme for startups provides various benefits to new businesses, including tax exemptions, easier access to funding, and simplified regulations to help startups grow. Startups can also benefit from mentorship and networking opportunities provided by the government and industry experts. However, the company has to qualify as a start-up, covered in the following section.

Eligibility for Start-up India Scheme 

The basic eligibility criteria for the Start-up India scheme are:

• The company should be incorporated as a private limited company, registered partnership firm, or limited liability partnership.
• The company must be less than 10 years old from the date of incorporation.
• The annual turnover must not go over INR 100 crores for any financial year since the incorporation.
• The company should be working towards innovation, development, or improvement of products, processes, or services with high potential for wealth and job creation

Please note that these criteria may change over time. It's advisable to check the latest guidelines on official government sources.

Benefits Provided Under the Start-up India Scheme

The Start-up India program provides several benefits to eligible startups, designed to support their growth and success in a competitive landscape. At its core, the initiative simplifies compliance procedures, reducing bureaucratic hurdles that are often experienced by new enterprises. A significant financial incentive comes in the form of tax exemptions for the first three years of operation, allowing startups to reinvest profits into scaling their ventures.

One of the program's most vital offerings is access to a fund with a substantial corpus of INR 10,000 crores, providing crucial capital for promising startups. Intellectual property protection is also prioritised, with fast-tracked patent applications and up to 80% rebate on patent fees, encouraging innovation and safeguarding novel ideas.

A pivotal feature is the Startup India Hub, a centralised digital platform serving as a knowledge exchange and resource centre. This hub connects startups with investors, mentors, and various support services, creating a thriving community that drives innovation and collaboration across the Indian startup ecosystem.

Differences Between Stand-up India and Start-up India Schemes

Both these entrepreneurial schemes in India are designed to provide business opportunities, but they differ significantly in their focus and approach. Let us compare Start-up India and Stand-up India in detail:

1. The primary difference between Start-up India and Stand-up India lies in their target beneficiaries and objectives. Stand-up India specifically targets women and SC/ST entrepreneurs, focusing on financial inclusion and social empowerment. In contrast, Start-up India caters to innovative startups across all sectors and demographics.
2. Another key point in our comparison of these Indian entrepreneurial schemes is the type of support provided. Stand-up India mainly offers financial assistance through bank loans, while Start-up India provides a more comprehensive support ecosystem, including funding, mentorship, and regulatory ease.
3. The scale of projects also differs: Stand-up India supports smaller ventures with loans up to INR 1 crore. Start-Up India can suit larger startups with potentially higher funding requirements and provide more benefits such as tax exemptions under section 80 IAC of the Income Tax Act.
4. While they differ in their approach and target beneficiaries, both schemes contribute significantly to the development of a stronger business ecosystem in India.

Conclusion

Stand-up India focuses on helping women and SC/ST entrepreneurs with financial support for smaller ventures, whereas Start-Up India offers a broad support ecosystem for innovative startups across various sectors.

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