The Prime Minister introduced the SISFS scheme on 16th January 2021. The DPIIT notified and approved this scheme on 21st January 2021.
The funding for these scheme capital firms and angel investors is available to startups only after giving their proof of concept.
Similarly, banks offer loans to asset-backed startups. Thus, it is important to provide seed funding to the startups in India that have innovative ideas.
Objectives of SISFS
The startup ecosystem in India generally suffers from fewer finance issues. The capital required by the startups at the stage of development often makes or breaks a situation for startups with good business ideas.
Several innovative business ideas fail due to high critical capital requirements at an early development stage.
Eligibility Criteria for SISFS
1. The eligibility criteria for a startup to apply for the Startup India Seed Fund Scheme are as follows:
2. A startup recognized by the DPIIT and those is not older than two years at the time of applying.
3. Startups should have a business idea to develop a product with viable commercialization, and perfect market fit.
4. Startups must use technology in the core product, business model, or methodology to solve the focused problem.
5. Priority is given to startups having innovative solutions in various sectors like waste management, social impact, water management, education, financial inclusion, etc.
6. Startups that have more than Rs.10 lakh of monetary support under any Central or State Government scheme are not eligible under this scheme.
7. The shareholding of an Indian promoter in a startup must be at least 51% while applying to the application.
8. A startup can have seed support in the form of grants and convertible/debt debentures, each one according to the scheme guidelines.
Application for Startup India Seed Fund Scheme
The application procedure for availing the seed fund from the incubator under the SISFS are as follows:
1. Visit the official Startup India Seed Fund Scheme website.
2. Click on the ‘Login’ button on the homepage.
3. The ‘Login’ tab will open. Click on the ‘Create an Account.
4. The registration page of the ‘Startup India’ website will open. And fill in all details asked to click on the ‘Register’ button.
5. An OTP will be sent to registered mobile numbers. Enter the OTP and click on the ‘Submit button.
6. Then visit the official Startup India Seed Fund Scheme website and click on the ‘Apply Now.
7. Select the ‘Apply Now’ button under the ‘For Startups’ option and log in using the username and password.
8. The application form will open. Enter all the details on the application form, upload the documents and click on the ‘Submit button.
9. After clicking the ‘Submit’ button, the application will be submitted for selection of the startup for seed funding under the SISFS scheme.
10. The SISFS will allow the startups to avail loans from commercial banks or financial institutions or raise investments from angel investors or venture capitalists.