Cabinet Approves Continuation of Stand-Up India Scheme Until 31 March 2031: 2.5 Lakh New Entrepreneurs to Benefit
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| Stand-Up India Scheme Extended to 2031: Loan Benefits Update |
Posted on 11 November 2026: ₹4,111 Crore Credit Guarantee Corpus Approved | Special Financial Support for Women, SC and ST Entrepreneurs | Loans Up to ₹1 Crore for Greenfield Businesses
The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the continuation of the Stand-Up India Scheme for another five years until 31 March 2031. The decision aims to strengthen entrepreneurship among women, Scheduled Castes (SCs) and Scheduled Tribes (STs) by improving access to institutional bank loans and encouraging the establishment of new businesses.
Under the extended scheme, the government aims to provide financial assistance to an additional 2.5 lakh entrepreneurs over the next five years. The Cabinet has also approved a Credit Guarantee Corpus of ₹4,111 crore to support lending institutions and improve credit access for eligible entrepreneurs.
The decision is expected to encourage new business development, create employment opportunities, and promote inclusive economic growth by supporting communities that often struggle to access formal business finance.
What Is the Stand-Up India Scheme?
The Stand-Up India Scheme is a Government of India initiative launched in April 2016 to promote entrepreneurship among women and people belonging to Scheduled Castes and Scheduled Tribes.
Its primary objective is to help eligible individuals establish new enterprises by providing access to bank loans through scheduled commercial banks.
The scheme focuses on encouraging first-time entrepreneurs to enter business activities in sectors such as manufacturing, services, trading and agriculture-allied activities.
By providing financial support and improving access to institutional credit, the initiative seeks to create a more inclusive entrepreneurial ecosystem in India.
Since its launch in 2016, the scheme has facilitated loans to more than 2.75 lakh women and SC and ST entrepreneurs.
With its continuation until March 2031, the government intends to extend these opportunities to another 2.5 lakh beneficiaries.
Major Highlights of the Cabinet Decision
The latest Cabinet approval includes several important provisions aimed at expanding entrepreneurship and strengthening the financial support system.
Key highlights include:
Scheme continuation: Stand-Up India will continue until 31 March 2031.
New beneficiaries: An additional 2.5 lakh entrepreneurs are targeted over five years.
Credit Guarantee Corpus: Approval of ₹4,111 crore.
Target beneficiaries: Women, Scheduled Caste and Scheduled Tribe entrepreneurs.
Loan amount: Above ₹10 lakh and up to ₹1 crore.
Eligible businesses: Manufacturing, services, trading and agriculture-allied activities.
Loan guarantee coverage: 85% of the loan amount.
Guarantee fee: Standard guarantee fee of 0.50%.
These measures are intended to make institutional finance more accessible and encourage the creation of new enterprises across different sectors of the economy.
Who Can Apply for a Stand-Up India Loan?
The scheme is designed primarily for eligible women entrepreneurs and individuals belonging to Scheduled Castes and Scheduled Tribes who want to establish a new business.
The main beneficiary categories are:
1. Women Entrepreneurs
Women entrepreneurs can seek financial assistance to establish new enterprises and become financially independent through business ownership.
2. Scheduled Caste Entrepreneurs
Eligible individuals belonging to Scheduled Castes can access institutional credit to start new businesses and participate in economic development.
3. Scheduled Tribe Entrepreneurs
Scheduled Tribe entrepreneurs can benefit from financial support to establish enterprises and create sustainable livelihood opportunities.
The scheme focuses on greenfield enterprises, meaning businesses established for the first time in the relevant sector by the borrower.
For non-individual enterprises, at least 51% of the shareholding and controlling stake should be held by an eligible woman or SC/ST entrepreneur.
How Much Loan Can Beneficiaries Get?
Under the Stand-Up India Scheme, eligible borrowers can obtain bank loans above ₹10 lakh and up to ₹1 crore for establishing greenfield enterprises.
The financial assistance can be provided in either of the following forms:
1. Composite Loan
A composite loan combines two types of financial assistance:
Term loan for purchasing machinery, equipment, infrastructure and other capital requirements.
Working capital to meet daily business expenses and operational requirements.
2. Term Loan
A term loan can be used to meet eligible long-term business investment requirements, including purchasing equipment, machinery and setting up business infrastructure.
The loan amount can cover up to 85% of the project cost, subject to the scheme's applicable conditions.
This financial assistance can help entrepreneurs reduce the initial financial burden of establishing a new business.
Credit Guarantee Corpus of ₹4,111 Crore: Why Is It Important?
One of the major announcements in the Cabinet decision is the approval of a ₹4,111 crore Credit Guarantee Corpus.
A credit guarantee mechanism helps reduce the lending risk faced by financial institutions when providing loans to eligible borrowers.
Under the scheme, credit guarantee coverage is 85% of the loan amount, subject to applicable rules and conditions.
This arrangement is particularly important for entrepreneurs who may have viable business ideas but face difficulties arranging collateral or securing conventional bank finance.
The approved guarantee corpus is intended to strengthen the credit guarantee framework and encourage lending institutions to extend financial assistance to eligible entrepreneurs.
The standard guarantee fee has been specified at 0.50%.
Which Business Activities Are Eligible?
The Stand-Up India Scheme supports new enterprises across several important economic sectors.
The eligible sectors include:
1. Manufacturing Sector
Entrepreneurs can establish manufacturing units involving the production and processing of goods, subject to applicable eligibility requirements.
2. Services Sector
Eligible service-based businesses can include professional services, repair services, technology-related activities and other permitted service enterprises.
3. Trading Sector
Eligible entrepreneurs can establish new trading businesses involving the purchase and sale of goods.
4. Agriculture-Allied Activities
The scheme also supports eligible agriculture-allied enterprises, creating opportunities for rural entrepreneurs and businesses connected with agricultural activities.
These sectors provide opportunities for entrepreneurs to develop business ideas according to local demand, available resources and market potential.
How Will the Extended Scheme Benefit Women and SC/ST Entrepreneurs?
The continuation of Stand-Up India is expected to strengthen financial inclusion and encourage greater participation in India's business ecosystem.
Its potential benefits include:
Encouraging Women-Led Businesses: Improved access to bank credit can help women establish independent businesses and increase their participation in economic activities.
Promoting SC/ST Entrepreneurship: Dedicated financial support can create opportunities for individuals from Scheduled Castes and Scheduled Tribes to become business owners.
Generating Employment: New enterprises can create direct and indirect employment opportunities in manufacturing, services, trading and agriculture-allied sectors.
Supporting Rural Development: Entrepreneurs can establish businesses in smaller towns and rural areas, potentially strengthening local economies.
Improving Financial Inclusion: Access to formal bank loans can help underserved communities participate more actively in the financial system.
Promoting Inclusive Economic Growth: Expanding entrepreneurship across different social groups can contribute to a broader and more balanced distribution of economic opportunities.
What Is the Government's Target by 2031?
With the continuation of the Stand-Up India Scheme until 31 March 2031, the government aims to support an additional 2.5 lakh entrepreneurs during the next five years.
This target builds on the progress made since April 2016, when the scheme was initially launched.
The government intends to strengthen the availability of institutional finance and create a supportive environment for women, SC and ST entrepreneurs to establish new enterprises.
The approved ₹4,111 crore Credit Guarantee Corpus is also an important part of this effort, as it aims to strengthen the guarantee mechanism supporting eligible business loans.
How to Apply for a Stand-Up India Loan
Interested entrepreneurs can explore the scheme through participating banks and official government channels.
The general steps include:
Identify a suitable new business or greenfield project.
Prepare a business plan and estimate the total project cost.
Check eligibility under the Stand-Up India Scheme.
Approach a participating bank for loan assistance.
Submit the required application and supporting documents.
The bank will examine the business proposal, financial requirements and eligibility before making a lending decision.
Applicants should confirm the latest application procedure, documentation requirements and scheme conditions with their participating bank.
Official Portal: https://www.standupmitra.in/
Conclusion
The Union Cabinet's decision to continue the Stand-Up India Scheme until 31 March 2031 represents an important step towards expanding entrepreneurship and financial inclusion in India.
With a target of supporting another 2.5 lakh entrepreneurs and approval of a ₹4,111 crore Credit Guarantee Corpus, the extended scheme aims to improve access to institutional finance for women, Scheduled Castes and Scheduled Tribes.
By encouraging new businesses in manufacturing, services, trading and agriculture-allied activities, the initiative can help create employment opportunities, strengthen local economies and promote inclusive economic development.
The continued focus on entrepreneurship reflects the government's broader objective of enabling more people to become business owners and contribute to India's economic growth.
Source: Press Information Bureau (PIB), Government of India, Delhi.
Disclaimer: This article is prepared for informational and educational purposes based on the Cabinet announcement. Loan approval remains subject to eligibility criteria, bank assessment and applicable scheme guidelines.
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