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First disbursement of funds for start-ups to be done in April : Kerala IT secretary

Kochi | Updated on February 09, 2020 Published on February 09, 2020

File photo of Secretary for IT; Electronics , M. Sivasankar   -  THE HINDU

“The first disbursement of the fund as per the new schemes announced in the State Budget for hardware start-ups will be done in April,” said M Sivasankar, Principal Secretary (Electronics and IT).

He was speaking on the concluding day of the fifth edition of the two-day Seeding Kerala investment summit, organised by Kerala Startup Mission (KSUM).

Requirements

Delineating the problems  faced by hardware start-ups in the State, Sivasankar said, “One of the fundamental requirements are  huge working capital, which is traditionally not funded by Angels, VCs or HNIs. The banks have certain financial norms like collateral security for giving credit.”

“We have a very large number of hardware start-ups in Kerala. They face problems for running companies and taking prototypes to the next level. So, we have suggested to the government to have a framework by which the hardware start-up requirements are funded to a certain extent,” he pointed out.

Funding

Sivasankar said the Budget has announced a scheme by which if a start-up has orders and if the orders are genuine, then a committee can give recommendations that this start-up is eligible for a certain level of funding. With that recommendation, the start-up can practically go and get over-the-counter financial disbursement from the State financial institutions such as  Kerala State Industrial Development Corporation Ltd and Kerala Financial Corporation.

“The first disbursement will be done in April. I hope banks will also join in this larger bracket in a short period of time. When we put this framework into practice, it would solve the very big challenge of companies,” he added.

Published on February 09, 2020
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