Maarg Manthan · Topic 8.5

Stand Up India Scheme

Current Affairs & Government Schemes › Financial Inclusion and Insurance Schemes · Topic 8.5

The Stand-Up India Scheme was a bank loan scheme of the Department of Financial Services, Ministry of Finance, launched on 5 April 2016, to promote entrepreneurship among Scheduled Caste, Scheduled Tribe and women borrowers. It facilitated at least one loan between Rs 10 lakh and Rs 1 crore per bank branch to one SC or ST borrower and one woman borrower for setting up a greenfield enterprise in manufacturing, services, trading or agri-allied activity. The loan could cover up to 75 per cent of project cost, with the Small Industries Development Bank of India as the main agency. The original scheme period ended on 31 March 2025, and a revamped version has been announced.

6 min read · UPSC Prelims · Current Affairs & Government Schemes · Financial Inclusion and Insurance Schemes

At a Glance

Ministry Finance, DFS
Launched 5 April 2016
Loan size Rs 10 lakh to Rs 1 crore
Target SC, ST and women borrowers
Status Original scheme ended March 2025; revamp announced
Exam link UPSC Prelims, Current Affairs and Government Schemes: Financial Inclusion and Insurance Schemes

Where Does It Fit?

This is the fifth topic of the macro on financial inclusion and insurance. It moves the macro from savings and insurance to credit for first-generation entrepreneurs from disadvantaged groups. Previous topic: Atal Pension Yojana (APY). Next topic: MUDRA Yojana (Micro Units Development and Refinance Agency).

How Did Stand-Up India Work?

Feature	Detail
Launch	5 April 2016, announced in the Budget speech of 2015-16 and launched at Noida, Uttar Pradesh
Ministry	Ministry of Finance, Department of Financial Services
Objective	Give each bank branch the task of financing at least one SC or ST borrower and at least one woman borrower, for a new enterprise
Loan size	Composite loan, covering term loan and working capital, between Rs 10 lakh and Rs 1 crore
Greenfield rule	The enterprise had to be a first-time venture in manufacturing, services, trading or agri-allied activity. A non-individual enterprise needed at least 51 per cent holding by an SC, ST or woman entrepreneur
Own contribution	The borrower had to bring at least 10 per cent of the project cost, and the loan could cover up to 75 per cent, with a low rate of interest
Agencies	Scheduled commercial banks, SIDBI as the main agency, the Stand-Up Mitra portal, and the Credit Guarantee Fund for Stand-Up India Loans run by the National Credit Guarantee Trustee Company

What Is the Status After March 2025?

End of the first phase: The scheme period was extended in steps and ended on 31 March 2025
Budget announcement: The Union Budget for 2025-26 announced a new scheme for 5 lakh first-time women, Scheduled Caste and Scheduled Tribe entrepreneurs, with term loans of up to Rs 2 crore over five years, as announced
Revamp: Statements by the Finance Minister in 2026 said that a revamped Stand-Up India scheme would be launched with wider benefits. As of the last check, the final guidelines should be taken from the Department of Financial Services
Reported reach: Reports in the past have said that lakhs of loans were sanctioned, with women forming a large majority of borrowers. Quote only a dated official figure
Compared with MUDRA: MUDRA loans are smaller and collateral free for micro units, as in MUDRA Yojana (Micro Units Development and Refinance Agency)
Compared with PMEGP: PMEGP gives a margin money subsidy, while Stand-Up India gave only credit, as in Prime Minister’s Employment Generation Programme (PMEGP)

What Else Should You Remember?

Greenfield: A greenfield project is a first-time venture in the sector, not an expansion of an existing unit
Composite loan: A single loan includes term loan and working capital, so the borrower deals with one lender
Handholding: The portal Stand-Up Mitra gave information on loans, training and handholding, with support from lead district managers
Credit guarantee: The guarantee fund covered a part of the loan so that banks would lend without collateral security in many cases
Collateral: Banks could ask for collateral security or a guarantee through the fund
Refinance: SIDBI gave refinance window to banks of Rs 10,000 crore at the start of the scheme
Target of 2.5 lakh: The scheme aimed at about 2.5 lakh borrowers over the first period, as announced in the Budget
Concerns: Banks were reported to be slow, many applications were rejected for lack of collateral, and the loan size was too large for first-time micro entrepreneurs
Social aim: The scheme tries to turn SC, ST and women entrepreneurs into owners, breaking the pattern that they are mostly employees and not owners
Link: The Credit Guarantee Fund Trust for Micro and Small Enterprises is a similar guarantee but for MSE loans in general, as in Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
Exam trap: Stand-Up India does not give a subsidy and is not a scheme of the Ministry of Social Justice

Why Does It Matter for the Exam?

Date and ministry: 5 April 2016, Ministry of Finance
Loan: Rs 10 lakh to Rs 1 crore
Targets: One SC or ST and one woman borrower per branch
Concept: Greenfield enterprise
Common errors: Quoting Rs 10 lakh as the upper limit or calling it a subsidy scheme

As an analytical point, credit targets for disadvantaged groups work only if the bank staff are trained and the guarantee is real. A revamped scheme should pair credit with mentoring and market access, and publish data by branch and by group.

Why Is This Topic Important?

Facts Date, loan range, target groups
Status Ended and revamped
Compare Versus MUDRA and PMEGP

What Came Next?

The next topic covers collateral-free loans for micro units under the MUDRA scheme. Next topic: MUDRA Yojana (Micro Units Development and Refinance Agency).

Key People and Terms

Greenfield First-time new enterprise
DFS Department of Financial Services
SIDBI Small Industries Development Bank of India
Composite loan Term loan plus working capital
NCGTC Credit guarantee trustee company

Exam Corner

Points to Remember

Launched: 5 April 2016.
Loan: Rs 10 lakh to Rs 1 crore.
Target: SC, ST and women.
Ended: 31 March 2025.
Budget 2025-26: new scheme for 5 lakh first-time entrepreneurs.

Do Not Confuse With

Stand-Up India and MUDRA Larger loans for SC, ST and women versus small loans for all micro units
Stand-Up India and PMEGP Credit only versus credit with subsidy
Stand-Up India and Start-up India Bank credit for SC, ST and women versus a start-up recognition and tax programme

Memory Hook

Ten lakh to one crore, one SC or ST and one woman in every branch, and the business must be new.

Mains Angle

Questions ask about credit for first-generation entrepreneurs. These points give a balanced frame.

Strengths Branch-level target and focus on SC, ST and women
Weaknesses Collateral demand, high loan size and bank reluctance
Way forward Mentoring, guarantee cover and published outcome data

A Question You May Face

An original practice question, not a past paper question.

“Examine how credit schemes such as Stand-Up India can promote entrepreneurship among Scheduled Castes, Scheduled Tribes and women, and what reforms are needed.”

How to Answer

Introduce Scheme, loan range, groups.
Role First-time ownership.
Gaps Collateral and bank reluctance.
Way Guarantee, mentoring, data.

GS Relevance

Prelims: launch, loan range, target groups, greenfield concept, agencies. GS Paper 3: entrepreneurship, inclusive growth, banking. GS Paper 2: schemes for vulnerable sections.

Frequently Asked Questions

What is the Stand-Up India Scheme?

Stand-Up India was launched on 5 April 2016 by the Department of Financial Services in the Ministry of Finance. It promoted at least one bank loan between Rs 10 lakh and Rs 1 crore per branch to one SC or ST borrower and one woman borrower for a new greenfield enterprise.

Who is eligible for Stand-Up India?

Eligible borrowers were Scheduled Caste or Scheduled Tribe persons and women, aged above 18 years, who wished to set up a first-time enterprise in manufacturing, services, trading or agri-allied activity. A non-individual enterprise needed at least 51 per cent held by an SC, ST or woman entrepreneur.

Which ministry runs Stand-Up India?

The Ministry of Finance runs it through the Department of Financial Services. The Small Industries Development Bank of India acts as the main agency, scheduled commercial banks give the loans, and the National Credit Guarantee Trustee Company runs the credit guarantee fund that supports the loans.

What is the latest status of Stand-Up India?

The original scheme period ended on 31 March 2025. The Budget for 2025-26 announced a new scheme for 5 lakh first-time women, SC and ST entrepreneurs with term loans up to Rs 2 crore, and the Finance Minister has spoken of a revamped scheme. Check official guidelines before relying on new terms.

What does greenfield mean in Stand-Up India?

Greenfield means a first-time venture of the beneficiary in manufacturing, services, trading or agri-allied activity. It does not cover the expansion or purchase of an existing business. The rule aimed to create new entrepreneurs from groups that have mostly worked as employees, and not to refinance old units.

PYQ Practice — Statement Analysis

1 Stand-Up India was launched on 5 April 2016.

True

It was announced in the Budget of 2015-16.

2 Stand-Up India loans range from Rs 10,000 to Rs 1 lakh.

False

The range was Rs 10 lakh to Rs 1 crore.

3 The scheme targeted SC, ST and women borrowers.