A challenge fund is a fund support mechanism to allocate funds for specific purposes using competition among organisations.
Small Industries Development Bank of India (SIDBI) in partnership with Foreign, Commonwealth & Development Office, UK (FCDO UK) has launched ‘Swavalamban Challenge Fund’ (SCF) to lend a helping hand to the entrepreneurs.
A challenge fund is a fund support mechanism to allocate funds for specific purposes using competition among organisations. If there is an idea which needs to be piloted or scaled up, but funds are an issue, challenge fund provides solution platform to present the idea in prescribed theme, implement and validate it. Later the same can be scaled up by leveraging other donor or financier support.
SCF shall provide financial support to non-profit organizations, educational institutions, social startups which have focus on sustainable livelihood, financial inclusion, and access to financial services besides promoting the culture of entrepreneurship in the country. On six themes of livelihood, women empowerment, financial literacy, responsible business etc. eligible entities can submit their proposal for award.
The SCF along with a digital portal was launched by Secretary, Ministry of MSME BB Swain in the presence of DK Singh, Development Commissioner of MSME, Sivasubramanian Ramann, Chairman and Managing Director (CMD) of SIDBI, Mamta Kohli, Senior Social Development Advisor and Shri Gaurav Kapoor, senior official of FCDO UK.
In a statement Ramann said, “The Azadi ka Amrit Mahotsav is going on and we thought to give a fillip to innovative initiatives leading to further ease of independence to entrepreneurship. Challenge fund comes with this perspective in mind.”
Under this fund, applications are invited in two categories : Pilot Category and Scale-up Category. Under the first category applicants can apply with their proposal to pilot their innovative ideas while in the second category already ongoing or completed projects done by the applicants for scaling-up can be nominated.
The total outlay of fund will depend on number of proposals selected in various themes and category-wise amount allocated is up to Rs 20 lakh for the Pilot Category and up to Rs 35 lakh for the Scale-up Category. To operationalize the fund, the project period shall be more than six months and up to two years.