Government launches Startup business loan scheme to boost entrepreneurship

KATHMANDU: In a bid to foster entrepreneurship, the government has introduced the ‘Startup’ business loan proposal for the fiscal year 2023-24. The initiative comes after the Industrial Business Development Institute solicited proposals from startup entrepreneurs.

The Ministry of Industry, Commerce, and Supplies gave the green light to the Startup Business Loan Operation Procedure 2024, setting the stage for allocating funds in this year’s budget.

The government has earmarked NPR 250 million for startup loans, aiming to provide loans of up to NPR 2.5 million at a 3% interest rate. Prospective entrepreneurs can submit applications and proposals within 21 days from the present date, as indicated in the information released on Friday.

The Startup Business Program is open to entrepreneurs in 16 sectors, including agriculture, livestock, forest products, tourism development, hospitality, science, technology, information and communication, human health, education, and skill development.

Other eligible sectors encompass easy and safe transportation, automobiles, traditional technology, production and service flow, research and development in minerals and mining, household or daily living, and food production and processing.

Guidelines specify that entrepreneurs meeting the criteria for startup ventures, possessing the latest knowledge, innovative ideas, expertise, and capacity, can apply for loans.

The application process includes monitoring and evaluating the startup’s progress through monthly reports submitted to the bank, committee, and institution. The responsibility to repay the principal and interest in line with the agreement lies with the startup entrepreneur.

Startups failing to repay within the stipulated time can seek recommendations from authorities for debt settlement. In cases of non-repayment, calculations will be based on bad debt, potentially leading to financial restrictions, such as blocking bank accounts or discontinuing social security allowances for the startup entrepreneur.

Projects deemed viable are secured, with entrepreneurs required to arrange insurance for their business or project through the Startup Security Fund.

The bank is authorized to charge a service fee of up to 0.1% when processing loan transactions. This initiative aims to empower entrepreneurs and facilitate the growth of innovative startups across diverse sectors.

Fiscal Nepal |
Friday February 2, 2024, 12:52:14 PM |

Leave a Reply

Your email address will not be published. Required fields are marked *