Govt may soon bring Rs 2,000cr credit guarantee fund for startups

CIOL Writers
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CIOL- Karnataka startups to get Rs400cr boost under 'Elevate' programme

In a bid to provide better funding facilities to the startups, the Government of India will soon be setting up a credit guarantee fund for start-ups with a corpus of Rs 2,000 crore.


Addressing a conference on Start Up India, Challenges and Sustainability, organized by the PHD Chamber of Commerce and Industry, Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek said, "We are in the process of setting up a credit guarantee fund of Rs 2,000 crore corpus that will provide up to 80 percent risk cover for collateral free credit being given by banks to startups."

Though no fixed time schedule was given for the scheme to become operational, however, the fund, once in place will ensure that the startups receive financial support from banks and financial institutions with a collateral free guarantee.

The government is also apparently working on relaxing existing taxes for start-ups. DIPP Secretary further suggested that this is one of the top priorities of the Modi government as it would not only create wealth for the promoter of such ventures but also facilitate employment creation.


He also said the government is providing funds under the Rs 10,000 crore 'Fund of Funds' and how the DIPP is fast-tracking the patent examination process.

"We are providing 80 per cent rebate in applications...a large number of startups have already availed this benefit and I hope that more will come," he added.

The department would soon roll out a learning module for startups and to learn about entrepreneurship, he added.