| Overview: The Venture Capital Fund for Scheduled Castes offers equity-based financial support to SC entrepreneurs, enabling them to build scalable businesses. It promotes inclusive growth by bridging funding gaps and empowering marginalised communities through structured and monitored startup investments. |
Unlocking Opportunities for Marginalised Entrepreneurs
The Scheduled Caste community makes up over 16.6% of India’s population (Census 2011). Despite various development initiatives, systemic barriers in access to capital have hindered entrepreneurial ambitions. Recognising this challenge, the Ministry of Social Justice and Empowerment introduced the Venture Capital Fund for SC (VCF-SC) to uplift SC entrepreneurs through equity-based support, not just loans.
Backed by the Industrial Finance Corporation of India (IFCI), this initiative focuses on scalable, profitable business ideas led by SC founders, fostering job creation and socio-economic upliftment.
What is the Venture Capital Fund for SCs?
The VCF-SC was launched in 2014 with a corpus of ₹200 crore to address capital gaps for first-generation Scheduled Caste entrepreneurs.
Key Objectives:
- Provide concessional finance through equity/quasi-equity instruments.
- Promote startup funding for SC entrepreneurs with scalable ideas.
- Bridge the credit gap beyond the traditional loan ecosystem.
Eligibility Criteria for SC Entrepreneurs
To benefit from this scheme, businesses must meet the following conditions:
- The enterprise must be promoted by an SC entrepreneur.
- The SC promoter should hold at least 51% shareholding.
- The enterprise must be a registered entity (Pvt Ltd/LLP).
- The business should be in an early growth stage or expansion-ready.
Funding Pattern and Limits
This scheme provides structured equity support tailored to meet the capital needs of SC-led enterprises.
| Feature | Details |
| Minimum Investment Size | ₹50 lakh |
| Maximum Investment Size | ₹15 crore |
| Mode of Funding | Equity/Quasi-equity |
| Tenure | 6 – 8 years |
| Exit Strategy | IPO, Promoter buyback, or strategic sale |
Sectors Supported Under the Scheme
The fund is sector-agnostic, but preference is given to:
- Green energy
- Agro-processing
- Manufacturing
- Healthcare
- Information Technology
- Services and logistics
How VCF-SC Differs from Traditional Loan Schemes
Understanding the key differences helps SC entrepreneurs choose the right funding model for their venture.
| Feature | VCF-SC | SC/ST Business Loan Scheme |
| Type of Support | Equity/Quasi-equity | Debt-based loan |
| Collateral Requirement | Not required | Often required |
| Repayment Pressure | Flexible exit mechanisms | Fixed repayment schedule |
| Target Stage | Early-stage & growth businesses | Existing businesses & expansion needs |
| Risk Sharing | With Government (IFCI-managed) | Entirely on borrower |
| What You Must Know: VCF-SC investments are not loans—entrepreneurs share profits, not interest. Learn the difference between debt and equity before applying. |
Complementary SC/ST Business Loan Scheme Initiatives
Besides the VCF-SC, the government also supports SC/ST entrepreneurs through the Stand-Up India Scheme, NSFDC Loans, and MUDRA Yojana. These SC/ST business loan schemes are particularly helpful for those not yet ready for equity funding.
Popular Business Loan Schemes for SC/STs:
- Stand-Up India: Loans from ₹10 lakh to ₹1 crore for greenfield ventures.
- NSFDC Loans: Interest rates as low as 4% for self-employment projects.
- MUDRA Loans: Unsecured loans up to ₹10 lakh under PMMY.
| Important to Know: Equity-based support like VCF-SC is complementary, not competitive, to government loan subsidies and other SC ST business loan scheme options. |
Common Mistakes to Avoid
Avoiding these common pitfalls can significantly improve your chances of securing and sustaining funding.
- Not maintaining 51% SC shareholding post-funding
- Lack of a detailed, validated business model
- Confusing equity funding with subsidies or grants
| Facts to Know: The IFCI-managed VCF-SC has already funded over 100 SC-founded ventures since its inception. |
The Role of Services Like Airtel Finance
While VCF-SC supports startups through equity-based funding, day-to-day capital needs like equipment purchases or working capital still require digital, flexible financial support. This is where Airtel Finance offers value through:
- 100% digital personal loans (up to ₹9 lakhs)
- EMI cards with pre-approved limits (up to ₹3 lakhs)
- Customised credit options with minimal documentation
These services complement schemes like VCF-SC by helping businesses manage emergency expenses and personal financial needs without disrupting their ownership or equity structure. Explore Airtel Finance for fast, secure, and flexible funding options
Driving Forward with Inclusive Financial Growth
The Venture Capital Fund for SC is transforming entrepreneurship for marginalised communities by offering vital early-stage funding. While equity helps build businesses, daily financial flexibility is key. Learn about contingent liabilities to safeguard your finances. With trusted digital financial solutions, Airtel Finance complements government initiatives for holistic growth. Start your financial journey today with Airtel Finance
FAQs
1. What is the Venture Capital Fund for SC?
A government initiative offering equity support to Scheduled Caste entrepreneurs for business growth.
2. Who manages the VCF-SC scheme?
The scheme is managed by IFCI Ltd. under the Ministry of Social Justice and Empowerment.
3. What type of funding does VCF-SC provide?
It provides equity or quasi-equity funding, not traditional debt-based loans.
4. What is the investment range under VCF-SC?
Investments range from ₹50 lakh to a maximum of ₹15 crore per venture.
5. Who is eligible to apply for VCF-SC?
SC entrepreneurs with 51% ownership in a registered company can apply.
