India is rapidly becoming a global hub for startups, thanks to a growing pool of entrepreneurial talent and government initiatives designed to nurture innovation. Recognizing the pivotal role startups play in economic growth, job creation, and technological advancement, the Government of India has introduced several schemes to support emerging businesses.
From financial assistance to mentorship and regulatory ease, these schemes provide a robust foundation for entrepreneurs to thrive.
Top 10 Government Schemes for Startups
Whether you're a budding innovator or an experienced entrepreneur, understanding these schemes can unlock opportunities to turn your vision into reality.
In this article, we delve into the top 10 government schemes for startups in India that are propelling entrepreneurial success.
1. Startup India Initiative
Launched in 2016, the Startup India Initiative is a flagship program aimed at fostering entrepreneurship and innovation. Designed to create a startup-friendly ecosystem, the initiative offers:
Moreover, the initiative includes the Startup India Hub, a networking platform connecting startups with investors and mentors, and the Atal Innovation Mission, which encourages innovation at grassroots levels. With these offerings, Startup India empowers entrepreneurs to scale their businesses and drive economic growth.
2. Pradhan Mantri Mudra Yojana (PMMY)
Since its launch in 2015, the Pradhan Mantri Mudra Yojana (PMMY) has provided financial assistance to micro and small enterprises (MSEs). It offers collateral-free loans up to ₹10 Lakhs under 3 categories:
Shishu: For early-stage startups.
Kishor: For scaling businesses.
Tarun: For established businesses needing larger capital.
The scheme helps entrepreneurs acquire equipment, raw materials, and working capital. Accessible through banks, microfinance institutions, and NBFCs, PMMY has fueled countless success stories, creating jobs and boosting India's entrepreneurial ecosystem.
3. Stand-Up India
Launched in 2016, Stand-Up India promotes entrepreneurship among women and disadvantaged communities by offering loans of up to ₹1 Crore. Designed for greenfield enterprises in manufacturing, trading, or services, the scheme also provides:
Handholding support, including mentorship and training.
Market linkages to connect entrepreneurs with potential buyers and investors.
By addressing financial and structural barriers, Stand-Up India empowers under-represented groups (women, disadvantaged sections of society, etc.,) to contribute meaningfully to India's economic growth. With these offerings, Stand-Up India has provided funding to 1000s of entrepreneurs across the country, thereby creating job opportunities and contributing to economic growth.
4. Atal Innovation Mission (AIM)
The Atal Innovation Mission (AIM), established in 2016, aims to cultivate a culture of innovation across schools, colleges, and startups. Its two core programs are:
Atal Tinkering Labs (ATLs): Workspaces equipped with advanced tools for students to experiment and innovate in STEM fields.
Atal Incubation Centers (AICs): Incubators providing mentorship, funding, and networking for startups across sectors.
AIM’s initiatives nurture creativity, enabling startups to develop disruptive solutions and contribute to national progress.
5. Pradhan Mantri Yuva Yojana (PMYY)
The Pradhan Mantri Yuva Yojana (PMYY) focuses on imparting entrepreneurship education and training to India’s youth. Launched in 2016, the program:
Covers vital topics like business planning, financial management, and marketing.
Supports startups through the Credit Guarantee Fund Scheme for Startups (CGSS), offering collateral-free loans.
By equipping young minds with entrepreneurial skills, PMYY fosters a new generation of innovators who will lead India into the future.
6. National Entrepreneurship Awards (NEA)
The National Entrepreneurship Awards (NEA) recognize exceptional entrepreneurial talent across diverse sectors, including rural and social enterprises. Winners receive:
Cash prizes, trophies, and certificates.
Opportunities to network with industry leaders and potential investors.
By celebrating innovative ideas, NEA inspires aspiring entrepreneurs to pursue their dreams and contribute to India’s startup ecosystem.
7. Credit Guarantee Fund Scheme for Startups (CGSS)
The Credit Guarantee Fund Scheme for Startups (CGSS) offers collateral-free loans of up to ₹2 Crores, ensuring access to credit for early-stage ventures. Implemented through a network of financial institutions, the scheme covers:
Working capital.
Term loans.
Other credit requirements.
With the added benefit of mentorship and training, CGSS provides startups with the support they need to scale their operations.
8. National Initiative for Developing and Harnessing Innovations
The National Initiative for Developing and Harnessing Innovations (NIDHI) managed by the Department of Science and Technology (DST), supports innovation through:
Technology Business Incubator (TBIs): Offering infrastructure and mentorship.
Seed Support System (SSS): Providing early-stage funding.
Entrepreneur in Residence (EIR): Allowing entrepreneurs to gain industry experience.
Industry Innovation Cluster (IIC) program: Foster innovation and entrepreneurship within specific industry sectors.
NIDHI’s initiatives encourage startups to innovate across diverse fields, driving technological advancement and economic growth.
9. Biotechnology Ignition Grant
Administered by the Department of Biotechnology, the Biotechnology Ignition Grant (BIG) supports early-stage biotech startups. It provides funding of up to ₹50 Lakhs for:
Proof-of-concept studies.
Technology validation.
This program has catalyzed breakthroughs in healthcare, agriculture, and environmental conservation, solidifying India’s position in the global biotech arena.
10. Electronics Development Fund
The Electronics Development Fund (EDF), launched in 2012, promotes innovation in the electronics sector by:
Funding startups and SMEs developing hardware, software, and IoT solutions.
Supporting projects with up to 50% of the total cost (maximum ₹50 Crores).
By fostering electronics entrepreneurship, the EDF strengthens India’s competitiveness in this critical industry.
Aatmanirbhar Bharat App Innovation Challenge 2021
Introduced in July 2020 (now closed), this government startup scheme encouraged Indian startups to collaborate and create solutions made in India - for the benefit of Indians in the country and worldwide. Its purpose was to encourage tech and startups to produce cutting-edge mobile applications for a big cash prize.
Apps like Chingari (TikTok equivalent), YourQuote (a writing app), and Koo (Twitter equivalent - now defunct), were crowned first (₹20 Lakhs), second (₹15 Lakhs) and third (₹10 Lakhs) winners respectively.
Conclusion
India’s government schemes for startups have laid a solid foundation for entrepreneurial success, addressing diverse needs like funding, mentorship, and innovation. Whether it’s the tax benefits of Startup India, the accessible loans under PMMY, or the industry-specific support of BIG and EDF, these initiatives empower entrepreneurs to build, scale, and thrive.
As a startup founder, leveraging these schemes can accelerate your journey toward success. Explore the opportunities, take action, and contribute to India’s thriving entrepreneurial landscape.
Content updated on 2-Jan-2025.
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