SISFS gives a DPIIT-recognised startup up to ₹20 lakh as a grant for proof of concept, prototype development or product trials, or up to ₹50 lakh as convertible debt for market entry and scaling — one route, never both. Money is disbursed through a DPIIT-approved incubator in tranches tied to milestones, not as a lump sum.
The ₹70 lakh that does not exist
This is worth stating plainly because so many summaries get it wrong. The two ceilings are alternatives, not components of a single package. They do not add up to ₹70 lakh, and no startup is funded on both tracks. Planning your runway on the combined figure is how a funding gap appears halfway through a build.
Which route you are offered follows from what the money is for, not from what you would like. If the plan is to prove the thing works, that is the grant. If the plan is to sell it, that is the convertible-debt route. Our grant-vs-debt comparator works this out from your use of funds in a few seconds.
What each route gives you
| Grant | Convertible debt | |
|---|---|---|
| Ceiling | ₹20 lakh | ₹50 lakh |
| Funds | Proof of concept, prototype, product trials | Market entry, commercialisation, scaling |
| Repaid? | No | Converts to equity, or is repaid |
| Dilution | None | On conversion |
| Disbursal | Tranched against milestones, by the incubator — not paid up front | |
Who can apply
- A DPIIT-recognised startup. Recognition is free, done online, and is the precondition — see Startup India recognition.
- Incorporated not more than two years before the date of application.
- Indian promoters holding at least 51% of the shareholding at application.
- Has not received more than ₹10 lakh of monetary support under any other central or state government scheme. An earlier state grant counts towards this, which founders routinely forget.
How the application actually runs
SISFS is not disbursed by the government directly. DPIIT approves incubators, allocates funds to them, and those incubators select and fund startups. In practice that means you are applying to an incubator, and the choice of incubator is a real decision: sector focus, cohort timing, selection appetite and the terms they set on the debt route all vary.
Selection runs in cycles rather than continuously, and money is released against milestones you agree with the incubator. Plan on the basis that funds arrive in stages against delivery.
Where applications come apart
- Wrong route. Asking for an amount only the debt component provides, against a plan the grant component covers. That gets a file rejected rather than resized.
- The ₹10 lakh ceiling. Prior support under another government scheme is cumulative and is checked.
- Vague milestones. Both routes are milestone-linked. “Build the product” is not a milestone; a specific, testable deliverable is.
- Recognition assumed, not held. DPIIT recognition has to be in place at application, not in progress.
How CapEasy helps
We assess whether you qualify before anyone spends time on a submission, work out which route your plan actually falls under, help shortlist incubators whose focus and cycle fit you, and prepare the application and milestone plan with you. Eligibility and approval rest with DPIIT and the incubator — we cannot and do not guarantee an outcome. What we can do is make sure the file is not the reason it fails.
Not sure SISFS is the right programme? The central seed funds and funded incubator programmes pages cover the alternatives, and the eligibility checker narrows the whole directory to what you can actually apply for.