Introduction

The Government of India has launched several initiatives to boost entrepreneurship and economic growth. Two of the most prominent schemes are Startup India and Standup India. While both programs aim to foster innovation and financial inclusion, they cater to different groups and have distinct objectives.

In this blog, we will explore the key differences, objectives, benefits, and eligibility criteria of Startup India and Standup India to help aspiring entrepreneurs make an informed decision about which scheme suits their needs best.

What is Startup India?

Startup India is a flagship initiative launched by the Government of India in 2016 to support startups by providing them with financial assistance, tax benefits, and easier regulatory compliance. The program aims to create a robust ecosystem for innovation and entrepreneurship.

Key Features of Startup India

• Tax Exemptions: Startups registered under Startup India enjoy a three-year income tax exemption and capital gains tax exemption.
• Simplified Registration: The registration process is completely online and hassle-free through the Startup India portal.
• Financial Support: Startups can avail of funding through the Fund of Funds for Startups (FFS), managed by SIDBI.
• Easier Compliance: Startups benefit from reduced regulatory burdens, including exemptions from certain labor and environmental laws.
• Government Tenders: Startups are eligible to participate in government tenders without the need for prior experience.

Eligibility Criteria for Startup India

• The startup must be registered as a Private Limited Company, LLP, or Partnership Firm.
• It should be engaged in innovation, development, or improvement of products and services.
• The entity should not be older than 10 years from its incorporation.
• The startup’s annual turnover should not exceed ₹100 crore.

What is Standup India?

Standup India is a government scheme launched in 2016 that aims to promote entrepreneurship among women and SC/ST entrepreneurs by providing them with financial assistance to start new businesses.

Key Features of Standup India

• Loan Assistance: The scheme provides bank loans between ₹10 lakh to ₹1 crore to SC/ST and women entrepreneurs.
• Greenfield Enterprises: The loan is available only for new businesses in the manufacturing, services, and trading sectors.
• Repayment Period: The loan tenure is up to 7 years, with a moratorium period of up to 18 months.
• Credit Guarantee: The scheme includes a credit guarantee cover to reduce financial risk.
• Support & Guidance: Entrepreneurs receive mentoring and training programs to help them manage and scale their businesses effectively.

Eligibility Criteria for Standup India

• The applicant must be a woman entrepreneur or belong to the SC/ST category.
• The business must be a greenfield enterprise (a new venture, not an existing business).
• The enterprise must operate in manufacturing, services, or trading sectors.
• The applicant must have at least 51% ownership in the business.

Key Differences Between Startup India and Standup India

Feature	Startup India	Standup India
Launch Year	2016	2016
Target Audience	Startups & entrepreneurs from any background	SC/ST entrepreneurs & women entrepreneurs
Primary Objective	Encouraging innovation & startup ecosystem	Promoting inclusive entrepreneurship
Financial Support	Fund of Funds for Startups (FFS)	Loans from ₹10 lakh to ₹1 crore
Tax Benefits	3-year tax exemption, capital gains exemption	No direct tax benefits
Regulatory Benefits	Simplified compliance, relaxed norms	Credit guarantee & financial support
Sector Focus	Any innovative sector	Manufacturing, services, & trading
Eligibility	Private Ltd, LLP, or Partnership firms	SC/ST & Women entrepreneurs with new businesses

Benefits of Startup India

1. Encourages Innovation: The scheme supports businesses focused on innovative solutions in technology, health, agriculture, and more.
2. Financial Relief: Startups can secure funding without worrying about tax burdens and compliance complexities.
3. Investor Support: The government provides a Fund of Funds to help startups attract private investments.
4. Networking Opportunities: Startups get access to mentorship programs, incubators, and networking events.
5. Ease of Doing Business: Simplified compliance reduces operational challenges for startups.

Benefits of Standup India

1. Promotes Financial Inclusion: The scheme empowers SC/ST and women entrepreneurs, bridging economic disparities.
2. Access to Capital: Loans between ₹10 lakh to ₹1 crore provide substantial financial support to kickstart businesses.
3. Government-Backed Loans: Credit guarantees reduce the risk for lenders, making loans easier to secure.
4. Business Training & Mentorship: Entrepreneurs receive guidance on business operations, ensuring higher success rates.
5. Empowers Marginalized Groups: The scheme fosters economic growth by supporting underrepresented entrepreneurs.

Which Scheme Should You Choose?

• If you have an innovative startup in any sector and seek tax benefits, funding, and regulatory support, Startup India is the right choice.
• If you belong to the SC/ST category or are a woman entrepreneur and need financial support to start a new business, Standup India is the ideal scheme.

How to Apply for These Schemes?

Applying for Startup India

1. Visit the Startup India Portal: https://www.startupindia.gov.in
2. Register Your Startup: Provide business details, founders’ information, and upload required documents.
3. Apply for Benefits: Choose the schemes applicable to your startup.
4. Get Recognized: Upon approval, avail of tax benefits, funding opportunities, and compliance relaxations.

Applying for Standup India

1. Visit the Standup India Portal: https://www.standupmitra.in
2. Check Eligibility: Ensure your business falls under the greenfield category.
3. Approach a Bank: Apply for a loan through the designated bank branch or online portal.
4. Submit Business Plan: Provide a detailed business plan and necessary documents.
5. Loan Approval & Disbursement: Upon approval, receive financial assistance and mentorship.

Conclusion

Both Startup India and Standup India are significant initiatives aimed at fostering entrepreneurship in India. Startup India is ideal for innovative businesses seeking funding and tax benefits, while Standup India provides financial support to SC/ST and women entrepreneurs.

Choosing the right scheme depends on your business model, eligibility, and financial needs. By leveraging these government initiatives, aspiring entrepreneurs can drive economic growth and create employment opportunities in India.

Frequently Asked Questions (FAQs)

1. Can a business apply for both Startup India and Standup India?
No, since Standup India is specifically for SC/ST and women entrepreneurs with new businesses, while Startup India is open to all innovative startups.

2. Is there any fee for registering under Startup India?
No, Startup India registration is completely free.

3. Can I get a loan under Standup India for an existing business?
No, Standup India loans are only for new (greenfield) businesses.

4. What is the interest rate for Standup India loans?
Interest rates vary, but they are generally linked to MCLR (Marginal Cost of Funds-Based Lending Rate) set by banks.

By understanding these schemes, you can make an informed decision and take advantage of government support to build a successful business in India!