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To support entrepreneurs in building as well as growing their startup businesses, the Government of India has introduced several dedicated schemes from time to time. One of the most prominent schemes by the Government is undoubtedly the Startup India Seed Fund Scheme, which helps startups with seed funding during initial development stages.
If you are planning to incorporate a startup in India or recently incorporated one, then knowing about the SISFS is quite essential as it can provide necessary financial support and improve chances of turning your business into a successful venture. Thousands of startups in India have already benefitted from the scheme and yours could be next (provided that it's eligible).
The Minister for Railways, Commerce & Industry, Consumer Affairs and Food & Public Distribution, Sh. Piyush Goyal, launched the Startup India Seed Fund Scheme (SISFS) on April 19, 2021. The scheme provides financial support to startups for proof of concept, prototype development, product trials, market entry and commercialization.
SISFS is implemented by the Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce and Industry. It is a sector agnostic scheme. Therefore, startups from any sector can apply for it. Additionally, there is no minimum educational criteria for the founders to apply for the scheme.
To apply for the scheme, the startup must be recognized by DPIIT and it should not have been incorporated more than two years ago at the time of application. Startups that meet the requirements can apply for the scheme via Startup India website.
The features of the Startup Seed Funding Scheme include the following:
The scheme is designed to provide financial assistance to the startups so they can grow. It provides up to Rs. 20 lakhs as grants for validation, prototypes or product trials. For market entry and scaling, it provides up to Rs. 50 lakhs via convertible debentures, debt, or debt-linked instruments.
Startups belonging to any sector can apply for the scheme. However, certain sectors are given more priority, including social impact, waste management, financial inclusion and defence among others.
Under the scheme, year-around applications can be made via official Startup India Seed Fund portal.
There is no SISFS application filing fee or processing fee charged by the government or incubators for this scheme.
Under the scheme, recognized incubators across India are selected to disburse funds to startups.
The Startup India Seed Fund Scheme eligibility criteria for the startups is provided below in a detailed manner:
The startup must be recognized by the DPIIT.
It should be incorporated not more than 2 years ago at the time of application.
The startup should have a clear business idea to create a product/service with a market fit, practical commercialization and scope of expansion.
To solve the targeted problem, the startup must be utilizing technology in its product, service, business model or methodology.
The SISFS scheme is an agnostic sector scheme. So, startups from all sectors can apply. With that being said, startups creating innovative solutions in the following sectors will be prioritized:
The startup must not have received funding of more than Rs. 10 lakh from any other Central or State Government scheme. This does not include prize money from competitions, subsidized workspace, founder monthly allowance, lab access or prototyping facility.
At least 51% of the startup’s shares should be held by Indian promoters at the time of applying to the incubator for the scheme, as per the Companies Act, 2013 and SEBI (ICDR) Regulations, 2018.
A startup can avail seed funding in the form of a grant or debt/convertible debentures only once, as per the SISFS guidelines.
The following documents are generally required while filing an application for the seed funding scheme:
DPIIT-issued Startup Recognition Certificate
Certificate of Incorporation issued by ROC
GST Number if entity is registered under GST system
MoA and AoA
PAN Card of Entity
Business Plan
Founder/Director Identity Details
Founder/Director PAN Details
Proof of Innovation / Technology
Plan regarding Fund Utilization
Disclosure regarding Prior Funding
Shareholding Pattern
Bank Account Details for Funds Disbursal under SISFS
Any other relevant documents as required
The apply for the seed funding scheme, the following process needs to be completed:
Visit the official website of Startup India SISFS portal. 
Then, once you are on the homepage, click on the ‘Apply Now’ button.
Then, click on the ‘Apply Now’ button for startups.
After that, login using your DPIIT credentials.
Once you are logged in, you can begin filling out the application form. Mention all the required details and attach the necessary documents.
Then, submit the application form online. The incubator will evaluate your proposal and invite your startup for pitch if shortlisted.
For startups in India, the SISFS remains one of the most crucial schemes since its launch in 2021. It provides funding to the qualifying startups and propels their growth. Under the scheme, year-round applications are invited from the startups having DPIIT recognition.
To avail the benefits of the SISFS scheme, the startup must mandatorily be recognized by the Department for Promotion of Industry and Internal Trade. Get in touch with Registrationwala for assistance in startup incorporation and getting your startup recognized by the department.
Q1. Who launched the Startup India Seed Fund Scheme?
A. This scheme was launched by Shri Piyush Goyal, Union Minister for Commerce and Industry, Consumer Affairs, Food and Public Distribution, on April 19, 2021.
Q2. What is Startup India Seed Fund Scheme amount?
A. Under this scheme, the qualifying startups receive up to Rs. 20 lakhs as grants for validation, prototypes or product trials. For market entry and scaling, the scheme provides up to Rs. 50 lakhs via convertible debentures, debt, or debt-linked instruments.
Q3. What is Startup India Seed Fund Scheme application fee?
A. There is no government fee for filing the SISFS application.
Q4. Is SISFS application process an entirely online process?
A. Yes, it is an entirely online process. The application, along with documents, needs to be submitted online via the official SISFS portal. No physical submission is required.
Q5. Which government department is responsible for the implementation of SISFS?
A. The Department for Promotion of Industry and Internal Trade (DPIIT), under the Ministry of Commerce and Industry, is responsible for the implementation of SISFS.
Hey there, I'm Dushyant Sharma. With the extensive knowledge I've gained in past 8 years, I have been creating content on various subjects such as banking, insurance, telecom, and all the important registration and licensing processes for various companies. I'm here to help everyone with my expertise in these areas through my articles.
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