In 2019, start-ups in India witnessed a surge of 44.4% in terms of investment. As reported by NASSCOM (National Association of Software and Services Companies), the total funding grew from USD 2 billion to USD 4.2 billion in late 2018, depicting a 108% growth in funding from 2016. In this article, we are going to discuss various Startup India Scheme Benefits.
The aforementioned figures show the enormous potential of start-up scopes in the Indian market. By keeping in mind the immense growth possibilities and need for employment opportunities, the Indian government launched Start-Up India initiative in the year 2016.
The scheme was launched to promote start-ups by helping them through availing tax and other benefits. It will provide startup loan through the Lead District Manager, scheduled commercial lenders, and SIDBI Stand-Up India portal.
Such business loan is contributing to the growth of startups in India and promises to benefit the country’s economy. This scheme is help trading and manufacturing businesses to boom in this country.
Startup India Scheme Benefits
Given the rise in investment figures, the implementation of the scheme has several benefits for entrepreneurs. Let us look at these.
Startup India Scheme Finance related Benefits
Under this scheme, startups can avail a rebate of 80% on patent costs. It also makes the process simple and fast. Also, the fee of the facilitator is paid by the government along with assistance to obtain such patents.
Registration Related Benefits
The registration procedure is simple as you there is no red tape. There is only one point of contact, which is the Start-Up India hub. You can either register through portal or its official app.
Besides the registration procedure, the process to apply for a start-up business loan is also simplistic. One should go through the checklist for business loan application before applying.
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Benefits on Income Tax
It is one of the useful Startup India scheme benefits. Once a company registers under the scheme, they can avail income tax exemption for the first three years. However, only startups with an issued certificate from Inter-Ministerial Board are eligible to avail the tax benefits.
Companies are also entitled to avail tax benefits on capital gains against the investments they have made.
Startups in the manufacturing industry are exempted from the criteria of ‘prior experience’ or ‘turnover’. These firms don’t have to go through any inspection with regard to labour laws for the first three years. Several other Startup India scheme benefits as such are granted so that startups can nurture forward.
To support entrepreneurship and promote startups amongst women and ST, SC communities, Government of India launched Stand Up India on 5 April 2016. As per the scheme, any woman entrepreneur or ST/SC candidate can avail a loan amount from Rs. 10 lakh to 1 Crore for enterprises in manufacturing, services, trading etc.
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Knowing how to set up your own trading business becomes comparatively easier for women with Stand Up India. However, a non-individual enterprise must have a women/ST/SC with a 51% share to be able to facilitate under this scheme.
Firms not qualifying for this scheme can alternatively opt for a start-up business loan. NBFCs like Bajaj Finserv provide such loans within 24 hours. Entrepreneurs can avail up to Rs. 30 Lakh.
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To conclude, Start-Up India has benefitted Indian entrepreneurs in several ways and is seen as a potential means of creating job opportunities in the future in addition to the economic growth factor.