Commerce Ministry notifies Rs 945 crore seed fund for startups

3AI February 2, 2021

DPIIT said that preference would be given to startups offering solutions in sectors including social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles, etc.

The government has approved the Rs 945-crore Startup India Seed Fund Scheme (SISFS) for the period 2021-25 to offer early-stage funding to startups for “proof of concept, prototype development, product trials, market entry and commercialization,” implementing body Department for Promotion of Industry and Internal Trade (DPIIT) said in its notification. Startups across sectors registered with the DPIIT and incorporated not more than two years ago at the time of applying for the scheme will be eligible for securing capital. The funding will be disbursed through selected incubators assisted by the central government or state governments.

“We are on course to implement the scheme wef 1 April ‘21,” DPIIT Joint Secretary Anil Agrawal tweeted on Friday. Prime Minister Narendra Modi had earlier this month announced the seed fund at the Startup India’s international summit Prarambh. In his address, PM Modi had said that the government is taking steps to ensure that there is no shortage of capital for startups and that the government will also help startups to raise debt capital ahead by providing the guarantee.

Apart from the two-year incorporation window, DPIIT said that preference would be given to startups offering solutions in sectors including social impact, waste management, water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles, etc. Also, eligible startups should not have received over Rs 10 lakh of monetary support under any other Central or State Government scheme and that founders should have at least 51 per cent stake at the time of application to the incubator for the scheme.

The selected incubators will disburse up to Rs 20 lakhs as grant to startups for their validation of proof of concept, or prototype development, or product trials. This grant will be disbursed in milestone-based installments that can be related to the development of prototype, product testing, building a product ready for market launch, etc. Further, up to Rs 50 lakhs will be offered to startups for market entry, commercialization, or scaling up through convertible debentures or debt or debt-linked instruments.

The government also announced eligibility criteria for incubators assisted by the central government or state governments to participate in the scheme that included at least two years of operability on the date of applying for the scheme, capacity to seat at least 25 individuals, at least five startups undergoing incubation at the time of application of the scheme. The scheme will be executed and monitored by an Experts Advisory Committee (EAC) to be set-up by DPIIT. EAC will evaluate incubators to provide grants of up to Rs 5 crore in milestone-based three or more installments.

Picture from freepik.com

Enriching Customer Data Platforms with Customer Identity Graphs in a Cookieless World

Featured Article: Author: Jayachandran Ramachandran, Senior Vice President – Artificial Intelligence Labs, Course5 Intelligence The pandemic has created substantial changes in our shopping behavior. Even diehard offline buyers have moved to online channels, experiencing new ways of buying and fulfilling their needs through the digital ecosystem. Improving customer engagement and value realization by providing relevant […]

TransUnion Expands Global Capability Centers in India and South Africa

Centers in India and South Africa to support global organization and local markets CHICAGO, Feb. 22, 2021 (GLOBE NEWSWIRE) — As TransUnion (NYSE: TRU) continues to evolve and modernize its approach to business, the company announced expansion of its existing Global Capability Center in Chennai to Pune, India and establishment of a new Global Capability […]

Accentuating customer experience: Digital Chat Agents & Chatbots

As e-commerce (and retail in general) becomes increasingly global and competitive, business leaders understand that AI can be a valuable tool in reconnecting with consumers. AI has the power to analyze huge amounts of data from numerous sources, including human behaviors and emotions. This can then be used to create more meaningful customer experiences. Take, […]

Blockchain mustn’t get blocked: Regulate but do not ban Bitcoin

The government’s proposed bill to ban cryptocurrency could deal a blow to India’s tech credentials . Since I started writing this column on technology a couple of years ago, two things have been eminently predictable. One is Elon Musk, the richest man in the world now, doing unpredictable things: Boring tunnels, implanting chips in pigs’ […]

India's largest platform and marketplace for GCCs & AI

3AI Digital Library