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Financial services and their types

Financial services are the economic services which involve investment, lending, and management of assets and money. It can be defined as products and services offered by banks, financial institutions, NBFC’s, etc.

Importance of financial system

It is the proximity of financial services which enables a country to improve its economic condition by increasing the production levels, which leads to the economic growth of the country and its importance is as follow:

Expands activities of the financial market.

Helps in economic growth

Ensure greater yield on investment

It helps in the economic development of the country.

Balanced regional development.

It helps in the promotion of domestic and foreign trade

Types of financial services

Financials services are essential for the expansion of existing industries, creation of new business opportunities, etc. various types of financial services are as follows:

Banking: Banking services include handing deposits into current & savings accounts, as well as lending money to customers. Banking services are one of the backbones of the Indian Financial System. The banking sector is regulated by the Reserve Bank of India. The banking sector provides various types of financial services like individual banking, business banking, loans.

Credit Rating: A credit rating is an evaluation of the credit risk, translated into a current opinion as on a specific date of security (debt) issued. Credit rating opinions usually depends on the probability of interest and principal obligations.

Capital Restructuring: These services are offered primarily to corporate organizations that involve changing the mixture of debt and equity in a company's capital structure. This segment includes different types of financial solutions like structured transactions, lender negotiations, accelerated M&A, and capital raising.

Portfolio Management: This type of financial services includes selecting and overseeing a different group of investments that meet a client's long-term financial objectives and risk factors. Portfolio managers are the designated persons for the portfolio management type financial services.

Mutual Funds: Mutual funds provide small or individual investors access to professionally managed portfolios. These service providers offer professional investment services & they generally have low risk, tax benefits & diversified investment opportunities.

Factoring: It is a type of financial transaction in which a business sells its accounts receivable to a third party (called a factor) at a discount & to meet the immediate cash needs a business sometimes factors its receivable assets.

Conclusion:

Financial Services are not only limited to deposit-taking, loan, and investment services, but in Today’s era of globalization, it also present in the fields of insurance, estate, trust and agency services, securities.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC). IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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Budgeting & its Importance

A budget is a financial plan for all planned expensed and revenue. The budget helps in the planning of saving and pending for the near future. The budget may also include planned sales volumes, revenues, costs and expenses, assets, liabilities and cash flows, etc.

If a person don’t have enough money to do everything they would like to do, then use the budgeting planning process to prioritize spending and focus spending of money on the things that are most important to you.

Importance of budgeting

In order to make effective decisions and actions, every business needs to have a plan for profitability. The budget serves several purposes:

A goal setting exercise

Act as an approval process.

Provides measures for assessing company performances.

Ensure that business can fund its current commitments.

It is the basis of all business success. The budget helps in planning and control of the finance aspects of the business. It helps in the identification of currently available capital, concentrates on cash flows, reducing costs, improving profits, etc. When things don’t go as per plans, budget works as a tool that provides a mechanism for identifying and focusing on departures from the plan. The budget provides the benchmarks against which one can compare the actual expenditure over budgeted expenditure and can judge the success and failure in achieving goals.

The budget should provide sufficient details of each unit for revenue and cost. Another important advantage of the budget is that they can be instrumental in the identification of constraints and bottleneck activities.

There are different types of budgets that can be planned in organizations:

Sales budget

Production Budget

Financial budget

Overhead budget

Personnel budget

Master budget

The master budget is the aggregate of all budgets of the company’s individual budgets to provide a complete picture of financial activities.

Conclusion:

A company’s strong financial is a clear sign of development and implementation of budget policy for making better use of resources, which results in future growth and prosperity.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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Industry Analysis

Industry analysis is a tool used by business owners and other individuals to understand the position of the company & its relative competitors in a business environment. This analysis helps businesses to identify the strength & threat occurs in the business & various economic perspective in the marketplace. The first process is to assess the impact of Porter's five forces in performing an industry analysis because when an industry grows, it is very difficult to say that all industries in the industry will grow simultaneously.

Factor Affecting Industry analysis

It is important to examine industry specific factors when you are going to select an industry.

Product Life-cycle: the Product life cycle of the industry, demand in the market, and industry size help in taking deciding of formulation of strong marketing strategies.

Industry size and growth: It gives the marketer an idea for the market demand. Information on the sales, profits, costs, a number of firms and employees helps a person to do the analysis on the growth of the specific industry.

Demand Supply Gap: It leads to two situations of the gap in the market:

Excess supply which reduces the profitability of industry due to the decline in the realization of the unit price.

Short supply in the market leads to an increase in the profit due to higher pricing payment by the consumer.

Techniques used in industry analysis 

Two main techniques are used for analysing the industry factors, which are as follow:

Regression analysis: This technique helps the investor in diagnoses the factors that determine the demand for the final product of a particular industry. Various factors like GNP, per capita income, price elasticity of demand need to considered for this analysis.

Input-output Analysis: Input-output analysis helps to reflect the flow of goods & services through the different steps from the production process to the final product. It carried out to detect changing patterns, demands, trends that indicate growth & decline reasons for industries.

Conclusion: 

Understanding of company's operating environment can help an analyser to formulate an effective strategy for a particular industry. This helps to utilise the limited resources of a business in the most efficient way. 

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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Financial System

A financial system is a system of interrelated activities of different institutions such as banks, insurance companies, and stock exchanges that work together to achieve predetermined goals. It includes financial market, services, institutions and financial instruments which helps to generate savings, capital formation, investment & growth. Financial system allows the exchange of funds between various lenders, investors, and borrowers. Financial systems operate at both national and global levels.

It also includes sets of rules and regulations that borrowers and lenders use to decide which projects to be finances, who finance projects, and period and terms of financial deals.

Significance of the financial system

The primary significance of the financial system is as follow:

Mobilization of savings.

Stimulating capital formation.

Helps to meet the fund requirement of business through financial Market.

Helps in the commencement of organization business production.

Leads to capital formation.

Finally brings economic growth.

Types of the financial system

Indian financial system formally consists of two types:

Formal Financial system

Informal Financial system

Informal Financial System: Informal financial system consists of money lenders, funds, associations, clubs etc. This financial system responds quickly to short term financing requirements and helps to low income people who can’t able to take advantage of the formal channel. Informal Financial system is not subject to interest rate regulation of government & do not incur any legal expenses. However, due to lack of transparency and unsystematic way of financing this system leads to less preferable as compared to the formal system.

Formal Financial system: Formal financial system consists of mainly four segments such as financial institutions, market, instruments and financial services.

Financial Institution: They are intermediary of financial market & helps to facilitate financial transactions. Financial instruments are classified further into banking & non-banking financial institutions.

Financial Market: It is a marketplace where trading of securities including equities, bonds & derivatives takes place. The financial market is divided into money market & capital market.

Financial instruments: Financial instruments are also known as financial assets. It includes cash deposits, loans, account receivables, Letter of credit, banknotes etc. these instruments have a monetary value.

Financial Services: It includes a wide variety of asset-based & non-asset-based services and involves investment, lending & management of money and other assets.

Conclusion

From the above explanations, we can say that the financial system provides a link between investment & saving for the creation of wealth and helps in the growth of the economy.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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Sustainable growth

Sustainable growth is attainable growth that a company could maintain to sustain in an environment without running into problems. The concept of sustainable growth helps organizations for planning healthy corporate growth. In addition to this, the sustainable growth rate is the maximum growth rate that a company can sustain without additional equity or debt.

SGR Formula

SGR = Return on Equity * (1 – Dividend Payout Ratio) 

A company with high SGR are effective in maximizing their sales & revenue.  

This rate provides an estimate at the time of raising external capital & provide a guideline as to how much funds should be acquired.

What Makes an Organization Sustainable?

Sustainable growth means an organization’s growth that is not only speedy but also holistic. Majorly, it means attending those issues which are ‘important’ instead of ‘urgent’. Sustainable growth is important for the long-term development of enterprises. 

In order to sustainable, an organization Must:

Have clear strategic goals.

Able to attract, retain & manage competent staff.

Be able to scan its environment or context to identify opportunities for its work.

Have an adequate financial infrastructure.

Should have a good public image. 

Challenges of attaining sustainable growth

Sustainable growth creation is a prime concern of every small business owners and big corporate executives. However, achieving sustainable growth is not an easy task due to rapidly changing political, economic, competitive, and consumer environment. In this modern era of fashion & trends, buyers have less disposable wealth than their parents, which makes them more discriminating consumers. Sustainability, coupled with traditional risk identification on different issues.

Conclusion

Sustainable growth analysis tools give managers the information they need to make better decisions on the different environmental & strategic issues. At the end, a sound risk management approach that includes sustainability provides the higher authority with useful data, for identifying emerging issues. 

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC)

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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PROBLEM FACED BY SMALL SCALE UPCOMING UNITS AND ROLE OF SAMADHAN TO OVERCOME IT

Samadhan Samiti along with its unit INSTITUTE FOR INDUSTRIAL DEVELOPMENT is committed toWork for the improvement and establishment of small scale units.

Let us first discuss about the problems faced by these small industrial units-

The major problem is Incompetent Management, followed by a lack of technological updation, the problem in market support, management of finance, shortage of raw material, lack of awareness, etc.

Our training program consists of various managerial & operational functions like finance, production, marketing, taxation, enterprise management banking formalities, bookkeeping, etc.

Our training program shall guide the first generation entrepreneurs and educate them with various business processes & statutory compliances. This program is also helpful in evaluating their performance through a pre-designed assessment test.

This well-designed & well-defined training program is highly helpful in educating the new entrepreneurs in the establishment & successful running of industrial units. 

Our training program is well equipped to resolve all the common problems faced by new entrepreneurs in addition to the training program we provide project reports and also give facilities to get connected with machine suppliers and experts of the various industries. This is a unique effort and first of its kind in the country. We go hand in hand with the government in their steps to eradicate poverty and unemployment.

NEVER LOSE HOPE, STORMS MAKE PEOPLE STRONGER AND NEVER LAST FOREVER.

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ORIGIN OF CONCEPT OF FARMER PRODUCER COMPANY IN INDIA

Institute for Industrial Development (IID) on its mission to nurture and support existing and budding entrepreneurs today talk about the concept of Farmer Producer Company and its origin.

Collectivization of producers, especially small and marginal farmers, into producer organizations has emerged as one of the most effective pathways to address the many challenges of agriculture but, most importantly, improved access to investments, technology and inputs, and markets.

IID has taken various initiatives through its workshops to aware and educate people about the concept of Farmer Producer Company virtually at Large. The formation and development of FPOs will be actively encouraged and supported by the Central and State Governments and their agencies, using financial resources from various centrally sponsored and State-funded schemes in the agriculture sector agencies. This goal will be achieved by creating a coalition of partners by the concerned promoter body, involving civil society institutions, research organizations, consultants, private sector players, and any other entity which can contribute to the development of strong and viable producer owned FPOs.

A provision for setting up FPCs was made in the Companies Act, 1956, in 2003 by an amendment to the Act. According to the National Bank for Agriculture and Rural Development (NABARD), a producer company is a hybrid between a private limited company and a cooperative society. Therefore, it enjoys the benefits of professional management of a private limited company as well as mutual benefits derived from a cooperative society. 

Objectives of FPCs:

The objectives of producer companies shall include one or more of the eleven items specified in the Act, the more important of these being:

Production, harvesting, procurement, grading, pooling, handling, marketing, selling, the export of primary produce of members or import of goods or services for their benefit;

Processing including preserving, drying, distilling, brewing, venting, canning, and packaging of the produce of its members;  

Rendering technical services, consultancy services, training, education, research and development, and all other activities for the promotion of the interests of its Members

generation, transmission and distribution of power, revitalization of land and water resources, their use, conservation and communications relatable to primary produce;  

Manufacture, sale, or supply of machinery, equipment or consumables mainly to its members.

Promoting mutual assistance, welfare measures, financial services, insurance of producers or their primary produce;

Farmer Producer Company enjoys a 100% tax exemption, which has catered more attention to this concept. IID, in its coming blog, would talk about its incorporation and compliances. IID purpose is to make entrepreneurs aware about the ample opportunities available for them.

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Money Laundering

Money laundering is the illegal process through which funds and assets converted into legitimate funds and assets. In short, it is the process of converting black money into white or legal money. This process is used by the criminals to clean their “tainted” money to make it legal. The overall scheme under this process gives back money to the launderer in an indirect way. 

Understanding Money Laundering

Let’s understand the concept of money laundering with the help of an example of Hawala:

How Hawala System Works:

This system works with a network of different operators known as Hawala agents. For this transaction, a customer contacts a Hawala agent at their source location. In the end, the Hawala agent collects money from the person who wants to make a transfer. After that agent calls his counterpart where the transfer has to be made. Counterpart hands over cash to the recipient after deducting commission, and the process is settle through an informal settlement.

Stages of Money Laundering

Money laundering is a simple process, but its cycle divided into  three different stages:

Placement: It is the first and initial stage & includes the movement of cash from the source when the illegal money circulated into the system.

Layering: Injected money is then layered into the system & make it more difficult to detect laundering activity. Through this stage, money spread over different transactions in different countries and transactions.

Integration: This is the final stage of money laundering, money enters the economy mainly through the banking system, and it appears as normal business earnings.

Prevention of money laundering Act, 2002:

It Is an Act of the Parliament of India enacted by the NDA Government basically to sub-serve twin objectives.

Prevent money-laundering  activities

Provide confiscation of property derived from or involves in money-laundering.

This Act punishes those who commit an offence of money laundering, and there are several penalties and prosecution under this Act for the persons involved in money laundering.

Conclusion

The concept of money laundering circuit is one among the several permutations and combinations concepts, practices, and structures. On the issue of mechanics, a point to be kept in mind is that money laundering is not something that can be taught or learned, it is a dynamic and gradually evolving process, and one has to keep updated on the latest developments in the field.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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Mushroom Cultivation

A mushroom is fleshy, the spore-bearing fruiting body of a fungus (Fungi are the scavengers of nature), produced above ground, on soil, or its food source. It is a nutritious vegetarian Delicacy and contains many varieties. Mushroom contains many vitamins & minerals, and it is low on sugar & fat. It considers as a major horticulture product all over the world. Cultivation of mushroom needs a temperature between 20 & 30 degree Celsius. Ideally, it can be grown in hilly areas or artificially controlled temperature by building sheds in the plain area.

Phases of Mushroom Cultivation

Mushroom cultivation can be divided into five phases:

Phase 1: Composting

Composting preparation starts with horse manure. In mushroom cultivation too, waste products such as horse manure, straw, gypsum and wastewater are used to produce a high-quality substrate through which mushrooms will grow.

Phase 2: Spawning

The compost stays in the tunnel to mature for six days, after which the compost mixed with spawn that will produce the mushrooms: the mycelium. As a mushroom matures, it produces millions of microscopic spores on its gills lining the underside of a mushroom cap. Mycelium propagated vegetatively on various grains and known as spawn. Commercial mushroom farmers purchase spawn from companies specializing in spawn manufacturing.

Phase 3: Casing

After the spawning process, the matured compost spread onto long stainless steel boxes, called mushroom beds. These beds are inside special dark rooms known as cells. Out of all casing, Peat casing has been shown to be superior casing materials.

Phase 4: Pining

Mushrooms only grow wild in the autumn season. However, they can be cultivated year-round by recreating controlled atmosphere. Mycelium starts to form little buds. After that, it develops into mushrooms. Low air temperature and low humidity produce more buds, on the other hand, higher air temperature and humidity produce a fewer mushroom.

Phase 5: Harvesting

Harvesting is done at button stage and caps measuring 2.5 to 4 cm. Across. The first crop will appear about three weeks after casing. Harvesting of mushroom to be done by light twisting without disturbing the casing soil. Air temperature during cropping should be held between 57° to 62°F for good results. The relative humidity in the growing rooms should be high for drying of the casing but not as high that cause the cap surfaces of developing mushrooms to be clammy or sticky. Generally, Mushrooms harvested in a 7- to 10-day cycle, but this may be shorter or longer depending upon temperature.

Conclusion

It took approximately 15 weeks to complete an entire production cycle, from the starting to the final steaming. We can say that mushroom cultivation is a bright field for upcoming farmers with good prospects, and it requires minimum care, investment & technology.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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POVERTY

There are people in the world so hungry that God cannot appear to them except in the form of bread.  – Mahatma Gandhi

Poverty is a miserable state of affair in which an individual or family is deprived of the very basic needs of life like food, cloth, shelter. Healthcare & education and cannot live with even the minimum standard of living. In these living conditions, sometimes even survival becomes a challenge.

Poverty cannot be isolated as a single problem in society. Poverty is the mother of crimes and many other anti-social activities including terrorism.

Rapid economic growth & development are the only measures, which play a very important role in prevention & eradication of poverty.

SAMADHAN SAMITI is committed to prevent & eradicate the poverty by helping people in totality to establish their own micro small, small & medium size industrial projects. We are imparting necessary training to the interested people in the field and also sharing information about all the necessary requirements like the land area, manpower requirement, availability of the machine, raw material, power consumptions, loan availability and other statutory requirements. Organization’s expert team is also ready to help. We also provide necessary projects report. 

Emergence of the industry creates opportunities for individuals along with financial support to the poor section of society. SAMADHAN SAMITI along with its Institute for Industrial Development is committed for the eradication of poverty and to bring a smile on the faces of deprived class.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel “Entrepreneur India Tv” and mobile applications Entrepreneur India Live for entrepreneurs.

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STARTUP & STARTUP FINANCING

What is startup?

A startup is an entrepreneurial venture in order to develop a unique product or service and bring it to the market. It is a young company founded by one or more entrepreneurs in order to develop a unique product or service and bring it to market. By its nature, the typical startup tends to be a difficult operation, with initial funding from the founders & their families.

Some History's most successful entrepreneurs created startups known as Microsoft, founded by Bill Gates, Ford Motors, founded by Henry Ford, etc.

Startup Financing

Startup financing means some initial infusion of money requirement to turn an idea into the reality. Every startup needs access to capital, whether for funding product development, acquiring inventory and machinery, or paying salaries to its employees.

Innovative ways to finance a startup

Mostly Entrepreneur’s think first of bank loan as a primary source of money, but there are some innovative measures, including non-bank financing.

Here are some of the sources for startup funding:

Personal investment

In the initial stage of business, the first investor should be yourself - either with your own cash or with collateral on your assets. This is important because it proves to investors and bankers that you have a long-term commitment to your project and that you are ready to take risks.

Family & friends

This is money loaned by spouse, parents, family & friends. Investors and bankers consider this as "patient capital," however the loan obligation to friends and relatives should always be in writing.

Venture capital

The first thing to keep in mind is that it is not necessary for all types of entrepreneurs. From the beginning, you should be aware that venture capitalists are looking for technology-driven businesses and ideas with high-growth potential in sectors such as IT, communications, and biotechnology. Venture capitalists expect a healthy return on their investment. It often generated when the business starts selling shares to the public. Be sure to select for investors who bring relevant experience and knowledge to your business.

Angels

Angel investors are generally wealthy individuals or retired company executives who usually give support to start-ups at the initial moments. Angels typically invest their own funds, unlike venture capitalists who manage the pooled resources of others in a professionally managed fund.

Business incubators

Business incubators generally focus on the high-tech sector by providing support to new businesses for various stages of development. Businesses that receive this kind of support often operate within state-of-the-art sectors such as biotechnology, IT, multimedia, or industrial technology.

Peer-to-peer Lending

In Peer-to-peer Lending process Group of people come together and lend money to each other. Various small & ethnic business groups having similar interests generally support each other in their startup endeavors.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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KNOWLEDGE TO WISDOM

Knowledge is knowing that a tomato is a fruit. Wisdom is knowing not to put it in a fruit salad. – Brian O Driscoll To be honestly specific it can be said that knowledge in action is wisdom. If knowledge is not in action and practically it is not used in life then it becomes a burden and remains meaningless.

SAMADHAN SAMITI along with its Institute for Industrial Development is converting knowledge to wisdom to solve and eradicate the two most serious problems of the country.

POVERTY

UNEMPLOYMENT

SAMADHAN SAMITI along with its Institute for Industrial Development imparts practical Training to all those who are willing to establish their own industrial projects whether they are micro small, small or of medium size.

It also shares required information and knowledge regarding the projects through its documentaries, experts and project reports. Knowledge about the machine manufactures, raw material suppliers, marketing sphere, land and power requirements, and manpower is also shared.

We are not confined to just knowledge sharing but practically we help the new entrepreneur to start the project and also to run it successfully. This is how knowledge is converted to wisdom in the better and larger interest of the nation.

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UNEMPLOYMENT

An unemployment existence is a worse negation of life than death itself. – Jose Ortega Y Gasset

One of the most serious problems faced by our country is unemployment. This is a very acute problematic situation when an able bodied & qualified person is willingly searching for a job and is not able to find it. The unemployment rate is increasing per year and if this problem is not tackled in time it will be a challenge to society & economy.

Keeping in mind this present scenario, jobs in the Government sector are not likely to increase. Self-employment seems to be the best solution to this problem.

When there is the darkness we are left with two options we can curse the darkness or we can light a small candle. SAMADHAN SAMITI along with its Institute for Industrial Development is lighting a small candle in the present scenario of unemployment. They are encouraging, guiding, educating and helping the interested youth in becoming entrepreneurs by establishing their own industry. This will not only narrow down the economic imbalance of the society but also open new doors for the employment of the deserving youth and the economic support to their families. The emergence of one industry not only gives direct employment to some but also give indirect support to many needy persons.

To be more specific about the role of SAMADHAN SAMITI & Institute for Industrial Development it can be said that they are addressing the most vital social issue faced by the nation today i.e. unemployment. These services are rendered throughout the country. Response to these efforts is overwhelming. Services are extended by imparting Industrial Training, connecting with experts & machinery manufacturers, sharing all the necessary information about required land area power consumption, manpower requirements, capital requirements, available loan facilities and also about the required statuary requirements.

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Small and Medium Enterprises

What is small and Medium Enterprises?

Small and Medium Enterprises (SMEs), particularly in developing countries, are the backbone of the nation’s economy. This segment has developed in parallel with large scale industries and MNC corporations. The SME segment expected to be a key component for sustaining the future growth of various sectors in the country. Small and medium scale enterprises (SMEs) occupy a significant and strategic place for equitable development in all countries. 

Difference between small & big enterprises

The table below gives a fair idea about the difference between small & big firms in various ways:

Small Enterprises                                                Big Enterprises

Limited resources                                                  Ample of Resources

Requires less investment                                      Require huge investment

semi-skilled or unskilled manpower requirement   Skilled & specialized                                                                                               manpower requirement    

Independent of other business                               Dependent on smaller                                                                                              enterprises                

Limited area of business                                         Diversified business area

Respond quickly to changing market conditions     Highly vulnerable to                                                                                                changes in market

Classification of investment based on investment

In accordance with the provision of Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 enterprises classified into Micro, Small, and Medium according to the following criteria:

                                      Manufacturing Sector

Enterprises                                      Investment in plant & machinery

Micro Enterprises                              Does not exceed twenty five lakh rupees

Small Enterprises                              More than twenty five lakh rupees but                                                                    does not exceed five crore rupees

Medium Enterprises                          More than five crore rupees but does                                                                      not exceed ten crore rupees

                                      Service Sector

Enterprises                               Investment in equipment’s

Micro Enterprises                       Does not exceed ten lakh rupees:

Small Enterprises                       More than  ten lakh rupees but does not                                                                 exceed two crore rupees

Medium Enterprises                   More than two crore rupees but does                                                                     not exceed five core rupees

The Micro Small & Medium Enterprises (MSME) sector forms the largest generator of employment in the Indian economy. It forms a major portion of the industrial activity.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation centers at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.

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Goods & Service Tax (GST)

What is GST?

GST is an Indirect Tax. It is an overall tax structure covering the supply of goods and services. In the GST regime, significant indirect taxes like excise duty, service tax, VAT, CST, Luxury tax, entertainment tax, entry tax, etc. have been subsumed in the GST. It is a value-added tax levied on manufacture, sale, and consumption of goods & services.  

Need for GST in India

Introduction of GST is considered as a significant reform in the Indirect Taxation of India because before the implementation of GST in India various taxes have to pay at every stage & differently collected by the central & state government. On the other hand, GST brings in Uniform tax laws & regulations across all the states covering diverse industries, and the taxes will be divided between the Central & state government based on the prescribed formula.

Advantages of Goods & service tax

Following are some of the points that help to explain the advantages of GST:

Same tax structure across the whole country making one Nation, One tax.

Transparency in doing business.

The burden of the tax will reduce due to seamless credit.

It helps to mitigate Double taxation.

Tax Structure will be simpler.

More control over tax evaders helps in better administration.

Removing cascading of effects.

Composition scheme for Small Business.

Components of GST

Three components are applicable under the GST System:

Central GST (CGST): This tax component is levied on the Intrastate supply of goods and services by the central government.

State GST (SGST): This tax will be levied on the intrastate supply of goods or services by the respective state government.

Integrated GST (IGST): It is governed by the provisions of the IGST Act and levied on all inter-state supply of goods & services. In the case of inter-state supply of goods and services, only IGST charged by the central government and the proceeds shared among the Both Government.

Institute for Industrial Development (IID) is an incubator with the Government of India, Ministry of Micro, Small and Medium Enterprises, and department of start-up, Govt. of  Uttar Pradesh. IID is a unit of Samadhan Samiti working under Public Private Partnership with Government since the Year 1999. We are running our master incubation center at KVIC pavilion, Rajghat New Delhi with Khadi and Village Industries Commission (KVIC), and other incubation centers at Gokhale Marg Lucknow with National Small Industries Commission (NSIC).

IID nurtures the entrepreneurs virtually from the ideation till the establishing of Business Enterprise. We provide single window support to the First Generation entrepreneurs or Young Educated Youth by a step-by-step roadmap for establishing a business enterprise or becoming an industry ready person. We also work for unemployed youth to make them industry ready through various skill development programs. We have a unique incubation process through regular live workshops, seminars, industrial documentaries, skilling, professional & experts episodes on our portal www.iid.org.in, YouTube channel "Entrepreneur India Tv" and mobile applications Entrepreneur India Live for entrepreneurs.