In order to help startups to access funds, the Ministry of Commerce and Industry has proposed a credit guarantee scheme. Keeping in the challenges faced by the Indian startups to raise funds, Government has proposed a corpus contribution of Rs 2,000 crore.
According to Nirmala Sitharaman, Commerce and Industry Minister, the proposed scheme will provide credit guarantee of up to Rs 500 lakh per case. It will be inclusive of the term loan, working capital or any other instrument of assistance extended by member lending institutions to finance an eligible startup recognized by the Department of Industrial Policy and Promotion (DIPP).
This is not the first time when DIPP had announced the Credit Guarantee Fund. Earlier in October 2016, the government had announced the Credit Guarantee Fund with a corpus of Rs.2000 crores to support startups and their risk taking abilities.
The government is continuously helping entrepreneurs to set up their ventures with ease in order to achieve their dreams and goals. Recently, in June 2017 DIPP, under the commerce and industry ministry, has formed six different groups with members including academicians, representatives of professional firms and government officials to come together and work towards preparing India’s new industrial policy that includes startups, innovation, taxation, MSME (micro, small and medium enterprises), among many other things.