New Delhi: The Union Cabinet on Wednesday approved a five-year extension of the Stand-Up India Scheme, allowing women and entrepreneurs from Scheduled Castes (SC) and Scheduled Tribes (ST) to continue accessing loans to set up new businesses.
The scheme will remain operational until March 31, 2031, with a credit guarantee corpus of Rs 4,111 crore. The government aims to extend financial assistance to at least 2.5 lakh additional entrepreneurs during the next five years.
Announcing the decision at the Cabinet briefing, Union Minister Ashwini Vaishnaw said the programme was introduced to help women and SC/ST entrepreneurs establish their own businesses. He said the Cabinet had approved its continuation in view of the scheme’s performance.
How Much Loan Can Entrepreneurs Get Under Stand-Up India?
Under the scheme, eligible applicants can obtain loans of more than Rs 10 lakh and up to Rs 1 crore to establish new enterprises.
The financing covers businesses in manufacturing, services, trading and activities allied to agriculture. Loans can be offered as term loans or through a combination of term loans and working capital.
According to the government, financial assistance can cover up to 85 per cent of the project cost, subject to the scheme’s eligibility and lending conditions.
What Is The Credit Guarantee Benefit?
The extended scheme includes a credit guarantee mechanism intended to reduce the lending risk faced by financial institutions.
Vaishnaw said the guarantee fee has been standardised at 0.5 per cent, without any additional risk premium. The government will provide guarantee coverage for 85 per cent of the loan amount.
The scheme’s branch-level target is to facilitate an average of two loans per bank branch: one for a woman entrepreneur and another for an SC/ST entrepreneur.
Applicants will also receive assistance during the loan application process and guidance at subsequent stages of business development.
How Many Entrepreneurs Have Benefited So Far?
Launched in April 2016, the Stand-Up India Scheme has facilitated loans for more than 2.75 lakh women and SC/ST entrepreneurs, according to the government.
With the latest extension, the Centre aims to support at least 2.5 lakh more beneficiaries by March 2031.
The government expects the continuation of the programme to improve access to institutional credit for entrepreneurs from underserved communities, encourage new business ventures and create employment opportunities.
