India’s startup ecosystem has witnessed significant growth and made a substantial contribution to the country’s economy. With over 1,14,000 startups and the creation of 12 lakh jobs, it is evident that startups are playing a crucial role in India’s economic landscape. As the interim budget for 2024 approaches, the startup industry is eagerly anticipating some relief and support from the government.
One of the primary expectations from India’s Digital Lending Association of India (DLAI) is the establishment of the India Fintech Credit Fund (IFCF). This fund aims to provide affordable and easily accessible financial assistance to fintech companies. By offering wholesale financing at competitive rates, this fund can significantly benefit small and medium-sized startups. It can also support women’s credit and encourage fintech lenders to expand their operations beyond Tier-4 cities while promoting formal financing.
Startups are stressing the need for continuous government support to thrive and innovate. They are calling for relaxed regulations, access to modern technologies, and streamlined tax laws. These expectations include increased funding, less stringent regulations, and favorable tax policies to support entrepreneurship and foster business expansion.
Furthermore, the Indian startup ecosystem is looking to the government for crucial backing in various areas. Funding sources need improvement, tax breaks for research and development (R&D) activities should be introduced, and the regulatory structure must be strengthened. Incentives for environmental, social, and governance (ESG) practices should be offered, the tax treatment of employee stock ownership plans (ESOPs) needs to be addressed, and capital gains tax on startup shares should align with that of listed shares.
To boost the digital commerce sector, initiatives like the Unified Payments Interface (UPI), Rupay credit cards, and the Open Network for Digital Commerce (ONDC) should be enhanced. Startups are also seeking tax breaks for fintech companies, incentives for retailers in rural areas, and funding for last-mile connectivity in direct-to-consumer (D2C) e-commerce.
In addition to these expectations, crypto startups in India are hoping for a reduction in the Tax Deducted at Source (TDS) rate from 1% to 0.01% and the ability to offset losses against gains.
As the Union Budget is presented on February 1, it remains to be seen whether these expectations will be met by the Finance Ministry. The government’s response to these demands will play a vital role in shaping the future of India’s vibrant startup ecosystem and its significant contribution to the country’s economy.
Note: This news article has been generated based on a set of given details and does not reflect the personal opinion or views of the writer or the news agency.
