In the pre-budget consultation meeting with the Ministry of Finance, Department for Promotion of Industry and Internal Trade (DPIIT) on behalf of the start-ups of India is likely to have pushed for better access to seed fund for the entrepreneurs, said an official aware of the matter.
“We have heard from several start-ups over the past few months. One of the major suggestions of DPIIT will be on the seed funds. Suggestion is to reinstate seed funds, so that it is accessible to more start-ups,” said the official. Discussions also included enhancing the corpus for fund of funds and credit guarantee funds for start-ups, according to the source.
Launched in April 2021, Startup India Seed Fund Scheme (SISFS) was set up for 4 years to provide financial assistance to startups for proof of concept, prototype development, product trials, market entry and commercialisation, to help start-up reach a level where they will be able to raise investments from angel investors or venture capitalists or seek loans from commercial banks or financial institutions.
DPIIT created Startup India Seed Fund Scheme (SISFS) in April 2021 with an outlay of Rs 945 Crore. The fund ceased to exist after April 2025. DPIIT is suggesting bringing back the scheme for the start-ups. Making adequate working capital accessible to the start-ups has been on the agenda of the government in the previous budget too. The Department of financial services (DFS) under the finance ministry recently launched the Startup Common Application Journey on the Jan Sammarth portal, through which start-ups can avail loans up to ₹20 crore under the Credit Guarantee Scheme. Start-ups can apply for loans to all public service banks through the portal. DFS has previously said that India aims for 500 well-financed startups in 5 years with 'Fund of Funds'.
Finance Minister Nirmala Sitharaman chaired the fifth Pre-Budget Consultation with the stakeholders from the startups ecosystem on Tuesday. Union Minister of State for Finance Pankaj Chaudhary, DPIIT secretary Amardeep Singh Bhatia, Chief Economic Advisor Anantha Nageswaran were also present at the meeting.