SISFS application for startups: eligibility and steps

The Startup India Seed Fund Scheme is government money, but a founder never deals with the government directly. You apply to incubators, an incubator's committee decides, and the incubator pays you in stages against milestones you agree in writing.

This guide covers the founder's side of that process, using the scheme guidelines DPIIT published on the Startup India website. For the money already committed, see our breakdown of where the SISFS corpus went.

Who is eligible to apply for SISFS?

A startup can apply if it is recognised by DPIIT, was incorporated no more than two years before applying, uses technology at the core of its product, service, business model or distribution, and is at least 51% held by Indian promoters. It must not have received more than Rs 10 lakh under other central or state government schemes.

The full list in paragraph 3.1 of the guidelines:

• Recognition and age: DPIIT-recognised, incorporated not more than two years ago at the time of application.
• The idea: a product or service with market fit, viable commercialisation and scope for scaling.
• Technology: used in the core product or service, business model, distribution model or method.
• Preferred sectors: social impact, waste and water management, financial inclusion, education, agriculture, food processing, biotechnology, healthcare, energy, mobility, defence, space, railways, oil and gas, textiles and others.
• Prior government money: no more than Rs 10 lakh under other schemes. Prize money from competitions and grand challenges, subsidised workspace, founder monthly allowances, and access to labs or prototyping facilities don't count.
• Ownership: Indian promoters hold at least 51% when you apply.
• Once only: a startup gets each type of support only once.

Recognition comes first, and it is worth having for other reasons too. Our guide to DPIIT recognition benefits covers who qualifies under the 2026 notification and how to apply.

How much can a startup get under SISFS, and in what form?

A startup can get up to Rs 20 lakh as a grant for proof of concept, prototype development or product trials, and up to Rs 50 lakh through convertible debentures, debt or debt-linked instruments for market entry, commercialisation or scaling. The money can't be used to build facilities, only for the purpose it was granted for.

	Grant	Convertible or debt
Maximum	Rs 20 lakh	Rs 50 lakh
Purpose	Proof of concept, prototype, product trials	Market entry, commercialisation, scaling
Paid	In milestone-based instalments	On terms fixed at sanction
Cost	None to repay	Interest no higher than the prevailing repo rate
Term	For the project duration	No more than 60 months, with up to 12 months' moratorium
Security	Not applicable	Unsecured; no promoter or third-party guarantee

Expect a debt-heavy offer. An incubator may give no more than 20% of its total SISFS grant to startups as grants, so most of its corpus goes out as convertibles or loans. Our guide for incubators on how SISFS works on their side explains that limit.

How do you apply for SISFS step by step?

You apply online through the Startup India portal, choosing up to three incubators selected under the scheme, in order of preference. Incubators shortlist eligible applications, may invite you to present, and their committee decides within 45 days. If more than one incubator selects you, your first preference funds you.

1. Get DPIIT recognition and check the age, ownership and prior-funding tests above.
2. Pick up to three incubators selected as disbursing partners, ranked by preference. Pick ones whose sector focus fits yours.
3. Fill in the application: team profile, problem statement, product or service overview, business model, customer profile, market size, funds needed and a utilisation plan.
4. Shortlisting: each incubator checks you against the eligibility criteria, then may ask you to present to its committee.
5. Decision: the committee should decide within 45 days of receiving your application. You can track progress on the portal, and rejections are notified by email.

The preference order matters. If your first and second choices both select you, the first one funds you; if the first rejects you and the second selects you, the second funds you. A rejected startup can apply afresh.

What do incubators evaluate in an SISFS application?

Each incubator's Incubator Seed Management Committee scores you on eight criteria: the need for the idea, feasibility, potential impact, novelty, team, fund utilisation plan, any additional parameters and the overall presentation. The guidelines let each incubator set its own weights, so the same deck can score differently at different incubators.

The committee includes a nominee of the incubator as chair, a representative of the state government's startup nodal team, a venture capital fund or angel network representative, domain experts from industry and academia, and two successful entrepreneurs. DPIIT's expert committee approves its composition.

Criterion	What the guidelines ask
Need	Market size, the gap filled, whether it solves a real problem
Feasibility	Technical claims, method for proof of concept and validation, product roadmap
Potential impact	Customer demographic, the technology's effect, national importance
Novelty	Unique selling point of the technology, associated IP
Team	Technical and business strength
Fund utilisation plan	Roadmap for using the money

The utilisation plan you submit becomes the milestone list you are paid against, so write it as a schedule, not a wish list.

How is SISFS money disbursed after selection?

The incubator signs a legal agreement with you before the first instalment, setting out the terms and milestones. The first grant instalment should come within 60 days of your application, and each later instalment needs an interim progress update and a utilisation certificate. Funds go into the company's bank account.

At the end you submit a final report and an audited utilisation certificate. If the venture fails, the report sets out what you learned and why it failed. Incubators must also track your proof of concept, prototype, trials, launch, funding raised, jobs and turnover, so expect regular reporting.

The incubator and its staff may not charge you any fee, in cash or kind, for selection, disbursement, incubation or monitoring. DPIIT runs a grievance cell for delayed evaluations or disbursements.

Is money still available?

Check before you apply. In its reply to Lok Sabha Question No. 1446 of 28 July 2026, the government said that as on 30 June 2026 the full Rs 945 crore corpus was committed to 219 incubators, which had approved Rs 706.33 crore for 4,245 startups. Ask each incubator how much of its allocation is still uncommitted.

Questions

Who is eligible for the Startup India Seed Fund Scheme?

A DPIIT-recognised startup incorporated no more than two years before applying, with a technology-based product or service, market fit and room to scale, at least 51% Indian promoter shareholding, and no more than Rs 10 lakh received under other central or state government schemes. Prize money and subsidised workspace don't count toward that limit.

How much funding can a startup get under SISFS?

Up to Rs 20 lakh as a grant for proof of concept, prototype development or product trials, paid in milestone-based instalments, and up to Rs 50 lakh through convertible debentures, debt or debt-linked instruments for market entry, commercialisation or scaling. A startup can receive each type of support only once.

How do I apply for the Startup India Seed Fund Scheme?

Get DPIIT recognition, then apply online through the Startup India portal, choosing up to three selected incubators in order of preference. The application covers your team, problem, product, business model, customers, market size, funds needed and a utilisation plan. Shortlisted startups present to the incubator's selection committee.

How long does SISFS selection and disbursal take?

Under the scheme guidelines, the incubator's committee should select startups within 45 days of receiving the application, and the first grant instalment should be released no more than 60 days from receipt of the application. Later instalments need a progress update and a utilisation certificate.

Sources: Department for Promotion of Industry and Internal Trade, Guidelines for Startup India Seed Fund Scheme · Lok Sabha, Unstarred Question No. 1446 (DPIIT reply), 28 Jul 2026

For more on how startup funding works in India, read the MyStartupValley blog or visit mystartupvalley.com.