People planning to start a new business may have an important opportunity through the government's Stand-Up India Scheme. The Union Cabinet has approved the continuation of the scheme for another five years, until March 31, 2031.

The initiative focuses on encouraging entrepreneurship among women and people belonging to Scheduled Castes (SC) and Scheduled Tribes (ST). Under the extended programme, the government aims to provide financial assistance to at least 2.5 lakh additional entrepreneurs over the next five years.

Launched in April 2016, the scheme has already facilitated loans for more than 2.75 lakh women and SC/ST entrepreneurs.

How much loan can you get under Stand-Up India?

Eligible applicants can obtain bank loans of more than ₹10 lakh and up to ₹1 crore to establish a new business.

The loan can be structured in two ways:

• Composite loan: Combines term-loan and working-capital requirements.

• Term loan: Provides financing for eligible long-term business investments.

The loan can cover up to 85% of the project's cost, subject to the scheme's conditions and the bank's assessment.

For example, if an eligible business project costs ₹50 lakh, the scheme's financing structure may support a loan of up to ₹42.5 lakh. The applicant must arrange the remaining amount through their own contribution or eligible support from other schemes.

Which businesses are eligible?

The scheme supports new, or greenfield, enterprises in several sectors. Eligible activities include:

1. Manufacturing businesses

2. Service-based businesses

3. Trading enterprises

4. Agriculture-allied activities

The key requirement is that the proposed business should be a new venture rather than an expansion of an existing business.

Who can apply for the scheme?

The scheme is designed for women entrepreneurs and individuals belonging to Scheduled Castes and Scheduled Tribes.

For a non-individual enterprise, at least 51% of the shareholding and controlling stake must be held by an eligible woman or SC/ST entrepreneur.

Applicants should also meet the applicable bank lending conditions and other scheme requirements.

What is the benefit of the credit guarantee?

The government has approved a credit guarantee corpus of ₹4,111 crore to support lending under the extended scheme.

Under the revised framework, credit guarantee coverage will be 85% of the loan amount, with a standard guarantee fee of 0.50%.

This arrangement is intended to reduce the lending risk for banks and improve access to formal credit for eligible entrepreneurs. However, it does not mean that every applicant will automatically receive a loan. Banks will still assess the business proposal, financial details and repayment capacity.

How can you apply for a Stand-Up India loan?

Interested applicants can explore the scheme through the official Stand-Up India portal or the government's JanSamarth platform.

The general application process involves:

1. Visit the official Stand-Up India website or JanSamarth portal.

2. Register and provide the required personal information.

3. Enter details of the proposed business, including its sector and estimated project cost.

4. Prepare a business plan explaining the investment, working-capital requirements and expected revenue.

5. Select an appropriate bank and submit the loan application.

6. Complete the bank's verification and documentation process.

Applicants may need identity and address proof, category certificates where applicable, business registration documents, bank statements and a project report. The final document list depends on the lender and the nature of the business.

What does the extension mean for aspiring entrepreneurs?

The continuation of Stand-Up India until March 2031 gives eligible entrepreneurs a longer window to seek institutional financing for new ventures.

With a target of supporting another 2.5 lakh entrepreneurs, the initiative aims to improve access to business credit, encourage self-employment and create opportunities across manufacturing, services, trading and agriculture-related sectors.

Anyone planning to start a business should carefully prepare a realistic project report and check the latest eligibility conditions before applying. A government-backed loan can support a business idea, but applicants should also evaluate repayment obligations and the commercial viability of their proposed venture.