AI SummaryThe Venture Capital Fund for Scheduled Castes was a government scheme that provided concessional finance to entrepreneurs from the Scheduled Castes community to promote innovation, growth, and business expansion. Private Limited or Public Limited companies could access financial support ranging from ₹10,00,000 to ₹15,00,00,000 as debt or equity to scale their business operations.
Important Update: This scheme has been discontinued by the government from March 31, 2025. The budget allocation for 2025-26 was reduced to ₹1 lakh from ₹10 crore in the previous year. The Ministry of Social Justice and Empowerment has informed a parliamentary panel that a new Venture Capital Fund for deprived and marginalised groups is being planned, but no timeline has been announced for its launch. The details below are for reference purposes only.
Venture Capital Fund for Scheduled Castes - Overview
The Venture Capital Fund for Scheduled Castes operated under the Ministry of Social Justice and Empowerment to empower entrepreneurs from the Scheduled Castes population. The scheme supported businesses by providing concessional finance, targeting those working in innovative and growth-oriented sectors.
Eligible companies could receive financial assistance between ₹10,00,000 and ₹15,00,00,000. This was provided via debt instruments at a competitive 4% interest rate, or 3.75% for Scheduled Caste women and disabled entrepreneurs. Equity investment options were also available with an 8% return condition. The online application portal remains accessible for reference.
Key Information
| Detail | Information |
|---|---|
| Scheme Name | Venture Capital Fund for Scheduled Castes (VCF-SC) |
| Level | Central |
| Scheme For | Individual |
| Beneficiary States | All |
| Category | Business & Entrepreneurship |
| Target Beneficiaries | Business Entity |
| Sub Category | Setting up, startup, entrepreneurship, machine & skill up-gradation, technology upgradation |
| Benefit Type | Cash |
| DBT Scheme | No |
| Nodal Ministry | Ministry of Social Justice and Empowerment |
| Nodal Department | Department of Social Justice & Empowerment |
| Status | Discontinued from March 31, 2025 |
Benefits (When Scheme Was Active)
Size of Financial Assistance
- Financial assistance ranged from ₹10,00,000 (minimum) up to ₹15,00,00,000 (maximum).
- Total financial assistance could not exceed two times the current net worth of the company.
Funding Tenure
- Maximum tenure extended up to 10 years, including the moratorium period for debentures.
- For equity, the exit strategy was decided case by case, with a maximum tenure of 10 years.
Returns and Interest Rates
- Debt or convertible instruments carried an interest rate of 4% per annum.
- For Scheduled Caste women and disabled entrepreneurs, the rate was reduced to 3.75% per annum.
- Equity investments required an 8% return per annum at the time of exit or based on valuation, whichever was higher.
Working Capital and Incubator Support
- Up to 20% of total assistance could be used for working capital gap funding.
- If an innovative idea was selected by a Technology Business Incubator, operational funding of up to ₹10,00,000 per year for three years was available.
Disbursement Rules
| Assistance Amount | Funding Limit | Promoter/Other Contribution |
|---|---|---|
| Up to ₹5,00,00,000 | Max 75% of project cost | 25% by promoter/subsidy |
| Above ₹5,00,00,000 | Max 50% of project cost | 50% by promoter/bank/subsidy |
Eligibility Criteria (When Scheme Was Active)
To qualify, projects had to be in the manufacturing, services, or allied sectors, including startups and those incubated in technology centers ensuring tangible asset creation.
For Assistance Up to ₹50,00,000
- At least 51% shareholding for the last 6 months with management control, or a successor entity of a firm with an established 6-month track record.
For Assistance Above ₹50,00,000
- At least 51% shareholding for the last 12 months with management control, or a successor entity with an established 12-month track record.
Technology-Oriented Projects
- Innovative projects supported by IITs, NITs, premier business schools, or those holding patents/copyrights with commercial potential were eligible.
Exclusions
The following entities or individuals were not eligible:
- Entrepreneurs from Scheduled Tribes, Other Backward Classes, or the General category.
- Proprietary firms, partnerships, or LLPs as direct applicants (these had to convert into a Private or Public Limited Company first).
Application Process (When Scheme Was Active)
Registration and Submission
STEP 1 - Visit the official application portal and create an account.
STEP 2 - Log in, fill in the mandatory details, and upload the required documents.
STEP 3 - Confirm the information and click submit to receive confirmation.
Review Process
- Proposals underwent initial screening by the Screening Committee.
- Qualified projects proceeded to detailed site visits and due diligence by IFCI Venture Capital officials.
- The Investment Committee conducted the final review to decide on sanction.
- Upon approval, a Letter of Intent was issued to proceed with legal documentation and property valuation.
Documents Required (When Scheme Was Active)
The following documents were needed for application:
- Valid Caste Certificate.
- Detailed Project Report prepared by the promoters.
- Certificates from incubation centers or corporate supporters for innovative projects.
- Patent or copyright documentation in the entrepreneur's name.
- Sanction letter from a Government department if already receiving a subsidy.
References
Operational Guidelines PDF (2021-2026) | Application Portal | IFCI Venture Capital Funds Ltd | PIB Press Release
FAQ's
Is the Venture Capital Fund for Scheduled Castes still active?
No, the scheme has been discontinued from March 31, 2025. The budget allocation for 2025-26 was reduced to ₹1 lakh.
Which legal entities could apply when the scheme was active?
Only Private Limited or Public Limited Companies were eligible for this fund.
What was the minimum ownership requirement?
The entrepreneur had to maintain at least 51% shareholding as a Scheduled Caste entrepreneur throughout the tenure of the assistance.
Were disabled entrepreneurs eligible for lower rates?
Yes, disabled entrepreneurs and Scheduled Caste women entrepreneurs benefited from a reduced interest rate of 3.75% when the scheme was active.
Could a startup apply?
Yes, startups in manufacturing, services, and technology-oriented sectors were encouraged to apply provided they met the shareholding and business duration criteria when the scheme was active.
Is there a replacement scheme coming?
The Ministry has informed a parliamentary panel that a new Venture Capital Fund for deprived and marginalised groups is being planned, but no timeline has been announced for its launch.