Friday 26th April 2024
The Nepali Government has approved the ‘Working Procedure on Seed Capital for Innovative Businesses,’ enabling the commercial banks to issue subsidized loans to startup companies.
The startups can now avail a loan up to NPR 5 million or 50% of their total capital at a subsidized interest rate of 2%.
The government has announced the program with an aim to promote startups and businesses with innovative knowledge, skills, and capacities.
According to the Working Procedure, a five-member steering committee under the leadership of the National Planning Commission (NPC) will call for proposals from startups who have not been able to mobilize capital to innovate, run or operate their ideas.
The companies, including small and medium-scale enterprises from agriculture, energy, health, tourism, education, and information technology sectors, can submit their proposals.
In their proposals, the applicant should submit details about the innovative idea, associated risks, possible returns, required funds, expected seed capital, and positive impact on the economy, in a prescribed format of the working procedure.
The committee will then assess the proposals within 30 days and select appropriate proposals to offer the subsidy loans. Once the committee approves the proposal, the Finance Ministry will release the fund in three installments.
The first installment will be released to initiate the idea’s implementation, the second installment based on the work progress, and the last installment after the idea is implemented.
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