Government to set up Rs 2,000 crore credit guarantee fund for startups

New Delhi: The government is in the process of setting up a Rs 2,000 crore credit guarantee fund with a view to providing funding facilities to startups, a top official today 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 per cent risk cover for collateral free credit being given by banks to startups,"

Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek said.

He was addressing a conference on 'Startup India, Challenges and Sustainability' organised by PHD Chamber of Commerce and Industry here.

He also said the government is providing funds under the Rs 10,000 crore 'Fund of Funds'.

Enumerating steps taken for the promotion of budding entrepreneurs in the country, Abhishek said the DIPP is fast tracking the patent examination process.

"We are providing 80 percent rebate in applications...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.

Further, with the interaction and feedback from startups, the DIPP has identified about 25 issues including things related with employee stock ownership plans (ESOPs)on which the department is working.

Speaking at a session, former DIPP Secretary Saurabh Chandra said there is a need to push the manufacturing sector growth through innovation in order to create jobs and push economic growth of India.