5 Government Schemes That Can Fund Your Business in 2026

There is a version of India's entrepreneurial story that does not make it to headlines. It is not about unicorns or billion-dollar valuations. It is about the carpenter in Varanasi who needs better tools, the Dalit woman entrepreneur in Nagpur who cannot get a bank loan, and the tech founder in Jaipur who has a product idea but no seed money.

For all of them, the Indian government has built something. Not perfect, not always accessible, but present.

This article breaks down five active government schemes that provide financial support to businesses at different stages -- from informal artisans to early-stage tech startups. If you are building something, or know someone who is, this is worth reading carefully.

1. PM Mudra Yojana (PMMY) -- Loans Up to Rs 20 Lakh

What it is:
Pradhan Mantri Mudra Yojana was launched in 2015 with a specific mandate -- to extend formal credit to India's vast informal business sector. Non-corporate, non-farm micro and small enterprises have historically been shut out of bank lending because they lack collateral, credit history, or documentation. PMMY addresses exactly that.

How it works:
Loans under PMMY are offered through banks, NBFCs, and MFIs in three categories -- Shishu (up to Rs 50,000), Kishor (Rs 50,000 to Rs 5 lakh), and Tarun (Rs 5 lakh to Rs 10 lakh). A fourth category, Tarun Plus, was introduced more recently, extending the limit up to Rs 20 lakh for borrowers with a clean repayment track record.

No collateral is required under any category. Interest rates follow bank and NBFC norms and vary by lender.

Who should apply:
Small traders, vendors, artisans, service providers, and micro manufacturers who do not belong to the corporate sector and are not involved in agricultural activity.

Why it matters:
India has over 6 crore micro enterprises. A large share of them are self-financed or dependent on informal moneylenders who charge exploitative interest rates. PMMY makes formal, affordable credit available at scale. It will not make anyone rich overnight, but it gives small businesses a fighting chance at surviving and growing without falling into debt traps.

2. Stand Up India Scheme -- Loans from Rs 10 Lakh to Rs 1 Crore

What it is:
Launched in 2016, Stand Up India is one of the more structurally important schemes in India's entrepreneurship ecosystem. It mandates that every scheduled commercial bank branch extend at least one loan to an SC/ST borrower and at least one loan to a woman borrower for the purpose of setting up a greenfield enterprise.

How it works:
Loans range from Rs 10 lakh to Rs 1 crore and are meant for ventures in manufacturing, services, or trading. The borrower must be setting up a new enterprise -- not expanding or inheriting an existing one. Composite loans covering both working capital and term loan components are available under the scheme.

Interest rates follow Stand Up India guidelines and the lending institution's norms. Repayment is structured over a period of up to seven years.

Who should apply:
SC/ST entrepreneurs and women entrepreneurs who are first-generation business owners looking to set up a new enterprise. At least 51% stake in the business must be held by the qualifying borrower.

Why it matters:
Access to formal credit in India has long been shaped by social capital -- who you know, what caste you belong to, whether you own property. Stand Up India does not solve all of that, but it creates a structural guarantee that certain sections of society cannot be turned away by banks simply because of who they are. That is a meaningful intervention, even if implementation varies across branches.

3. Startup India Seed Fund Scheme (SISFS) -- Support Up to Rs 50 Lakh

What it is:
The Startup India Seed Fund Scheme was launched in 2021 under the DPIIT to address a specific and well-documented problem in the startup ecosystem -- the gap between having an idea and being able to prove it well enough to attract investor money.

Most early-stage startups fail not because their idea is bad but because they cannot fund the proof-of-concept phase. SISFS directly targets that gap.

How it works:
The scheme provides funding through eligible incubators, which apply to the DPIIT-constituted expert committee. Selected incubators then disburse funds to DPIIT-recognised startups in two forms:

Up to Rs 20 lakh as a grant for proof of concept, prototype development, or product trials
Up to Rs 50 lakh as a debt or convertible instrument for commercialisation and market entry

Disbursements are milestone-linked, meaning startups receive funds in installments as they demonstrate progress. This keeps accountability built into the process.

Who should apply:
DPIIT-recognised startups that are supported by an eligible incubator, are not more than two years old at the time of application, and have not received more than Rs 10 lakh in monetary support from any other government scheme.

Why it matters:
Seed capital is the most difficult kind to raise. Angel investors and VCs want traction before they write cheques. But you cannot build traction without money. SISFS breaks that cycle for early-stage founders by giving them runway to validate, iterate, and demonstrate -- before they go out to raise from the private market.

4. SAMRIDH Scheme -- Funding Up to Rs 40 Lakh

What it is:
SAMRIDH -- Startup Accelerators of MeitY for Product Innovation, Development and Growth -- is an initiative under the Ministry of Electronics and Information Technology (MeitY), implemented as part of the Digital India programme. It is designed specifically for technology startups that have moved past the idea stage but need structured acceleration support to scale.

How it works:
MeitY selects accelerators through a competitive process. These accelerators then identify and support eligible tech startups, providing them with a combination of government funding and investor co-funding of up to Rs 40 lakh per startup. Beyond money, the scheme provides mentorship, networking access, and market linkage support -- things that are often more valuable than the funding itself.

Who should apply:
Tech startups and high-potential ventures in the product and digital innovation space that are looking for structured acceleration -- not just capital but ecosystem support.

Why it matters:
Most funding schemes give you money and step back. SAMRIDH is designed as an ecosystem play -- connecting startups to the right people, right networks, and right markets. For a tech startup trying to go from product to scale, that combination of capital and connections is often what makes the difference.

5. PM Vishwakarma Scheme -- Toolkit Support and Loans at 5% Interest

What it is:
Launched in September 2023, PM Vishwakarma is arguably the most culturally significant scheme on this list. It is built around a recognition that India's traditional craftspeople -- carpenters, weavers, potters, blacksmiths, goldsmiths, and others -- carry centuries of skill but have been left behind by modern financial systems.

The scheme covers 18 notified trades and provides a combination of skill development, tool support, and affordable credit.

How it works:
Registered artisans receive:

A toolkit incentive of up to Rs 15,000 to purchase modern and advanced tools
Collateral-free loans of up to Rs 1 lakh in the first tranche and up to Rs 2 lakh in the second tranche, at a concessional interest rate of 5%
Free skill training to improve both craftsmanship and productivity

The total loan exposure can go up to Rs 3 lakh. The low interest rate -- 5% versus the 12 to 18% that informal lenders typically charge -- is a significant intervention for a community that has historically relied on moneylenders.

Who should apply:
Traditional artisans and craftspeople engaged in any of the 18 notified trades under the scheme. Registration is done through the PM Vishwakarma portal.

Why it matters:
India's informal artisan economy is enormous in cultural and economic terms but chronically underfunded. These workers do not have the documentation or credit history that banks typically require. PM Vishwakarma creates a formal pathway for them -- not by asking them to become something different, but by meeting them where they are.

A Quick Comparison

Scheme	Maximum Support	Primary Beneficiary
PM Mudra Yojana	Rs 20 lakh	Micro and small enterprises
Stand Up India	Rs 1 crore	SC/ST and women entrepreneurs
SISFS	Rs 50 lakh	Early-stage DPIIT startups
SAMRIDH	Rs 40 lakh	Tech startups via accelerators
PM Vishwakarma	Rs 3 lakh + toolkit	Traditional artisans, 18 trades

The conversation around entrepreneurship in India tends to focus on the top of the pyramid -- the funded, the featured, the fast-growing. But the real story of Indian enterprise is much wider and much more varied.

These five schemes together represent a policy architecture that tries to serve that wider story -- from the artisan to the app founder. The schemes are not without their limitations. Implementation gaps, awareness deficits, and bureaucratic friction are real problems.

But the money is there. The structure is there. What is often missing is the knowledge of where to look.

If you are building something -- or helping someone else build something -- start here.

For scheme-specific applications, visit the official portals: pmmy.mudra.org.in, standupmitra.in, seedfund.startupindia.gov.in, samridh.meity.gov.in, and pmvishwakarma.gov.in