Cabinet to approve creating Rs2,000 crore startup fund by July-end
New Delhi: The Union cabinet is expected to approve setting up of a Rs2,000-crore credit guarantee fund by July-end with a view to provide funding facilities to start-ups, a top official said on Monday.
The secretary of the department of industrial policy and promotion (DIPP), Ramesh Abhishek, said the fund would be used to lend to startups without any collateral. He said that last week, the proposal was approved by the finance ministry. Under this, Rs2,000 crore will be disbursed over a period of three years.
“One startup will get a maximum of Rs5 crore. We are hoping to get the cabinet approval on this by end of July to operationalise this fund,” he said during the launch of Startup India Hub portal. He said that about 7,500 startups will benefited from this corpus and it will generate an additional funding of Rs15,000 crore.
Since the launch of Startup India action plan in January 2016, Abhishek said Rs960 crore of funds were disbursed to different startups. The DIPP has put 1,000 facilitators for intellectual property (IPR)-related issues besides setting of 547 tinkering labs under Atal Innovation Mission.
“358 startups were facilitated for IPR, 1333 were recognised as startups, 39 startups were given income tax benefits and we are reviewing all other cases regarding this. These numbers are going to multiply this year as we have changed the definition of startups,” he said, adding that under the ‘Fund of Funds’ scheme, over Rs1,100 crore were disbursed last fiscal.
This year, the DIPP has sought Rs1,600 crore more from the finance ministry. Talking about the Startup India Hub portal, Abhishek said this platform will help all the budding entrepreneurs who want to seek information related with government’s scheme, about mentors, funders and accelerators.