About this programme
The Seed Fund Scheme from Kerala Startup Mission provides soft loans to early-stage startups for product development, customer development, marketing, and scaling up. Funding is structured as a loan at 6% simple interest per annum with a 12-month interest-free moratorium period, after which repayment occurs over 36 monthly instalments. Disbursement is milestone-based, with funds released upon meeting specified conditions.
A grant is financial support you don’t repay — awarded against eligibility and, usually, agreed milestones or utilisation of funds. The amount and form of support that actually apply to you depend on the programme’s rules and how your application is assessed — they are not fixed for every applicant.
It is aimed at businesses in product-based innovation · technology startups. Like most government programmes, it has its own eligibility conditions, documentation and application window, and these terms are revised from time to time. Because of that, it is worth confirming the current eligibility, amount and deadline on the official programme page before you invest time in applying.
How it works
Seed funds are provided as soft loans at 6% simple interest per annum. Applicants receive a 12-month moratorium period (no interest or principal due). After the moratorium, amounts (with accrued interest) are repaid in 36 monthly instalments. Disbursement occurs in tranches: approximately 50% released after document submission, remaining 50% released after interim progress report and utilisation certificate are submitted and reviewed by the Seed Expert Committee. Funds can be used for product development, testing, trials, test marketing, mentoring, professional consultancy, IPR, and operational staff.
Who can apply
Startups registered in Kerala as LLP or Private Limited Company with active KSUM Unique ID and active/active-compliant DIPP registration. Must be developing innovative product or technology (not service-based or trading businesses). Directors should maintain CIBIL score preferably above 750. No pending dues with government, KSUM, or other state incubators.
How to apply
- Register on KSUM website and obtain active KSUM Unique ID
- Submit online application via KSUM portal (Business Profile & Seed Proposal sections)
- Participate in one-on-one evaluation call (approximately Day 15)
- Present pitch before Seed Expert Committee (approximately Day 30)
- Submit required documents and undergo final evaluation
- Receive approval and execute loan agreement
- Receive first tranche of disbursement
Documents you’ll typically need
- Incorporation documents and Certificate of Incorporation
- DIPP registration (active or active-compliant status)
- PAN certificate of company and directors
- Bank account details and passbook (first page)
- CIBIL score report for directors
- Business plan and project proposal
- Balance sheet and financial statements
- Director identification documents
The exact checklist depends on the programme and your specifics.
Frequently asked
Is this a grant or a loan?
This is a soft loan structured at 6% simple interest per annum with a 12-month interest-free moratorium period, after which repayment occurs over 36 monthly instalments. It is not a grant but a loan product.
When do I need to start repaying the loan?
Repayment begins after the 12-month moratorium period. After this moratorium, the loan amount plus accrued interest is repaid in 36 monthly instalments (3 years).
What can the loan funds be used for?
Approved uses include product development, testing and trials, test marketing, mentoring, professional consultancy, IPR-related expenses, and manpower costs for day-to-day operations. Founder salaries and costly asset purchases are not permitted.
What CIBIL score is required?
Directors should ideally maintain a CIBIL score above 750, though this is a preference rather than an absolute requirement.
Reviewed July 2026. Government programmes change — confirm current eligibility, amounts and deadlines on the official programme page before you apply. CapEasy is a private consultancy and is not affiliated with any government authority.