Section 8 Startups Get Concessions on Government Tenders

In a progressive move to support mission-driven entrepreneurship, the Government of India has extended special concessions to Section 8 startups participating in public procurement and government tenders. This initiative, announced by the Ministry of Corporate Affairs (MCA) in coordination with the Ministry of Commerce and Industry, aims to promote equitable access for social enterprises in national development programs and service delivery contracts.

Under the revised guidelines, Section 8 startups are now eligible for relaxed eligibility criteria, including exemptions from requirements such as prior experience, turnover thresholds, and earnest money deposits (EMD) in specific tender categories. These concessions mirror those already offered to recognized startups under the Startup India initiative and are expected to enable non-profit entities to compete for government projects on a level playing field.

The policy applies to Section 8 companies engaged in sectors aligned with public interest, such as education, healthcare, rural development, skill training, environmental sustainability, and women’s empowerment. To qualify, these companies must be duly registered under the Companies Act, 2013, and, where applicable, hold recognition as a startup from the Department for Promotion of Industry and Internal Trade (DPIIT).

Officials clarified that while technical competence and project viability will remain critical assessment criteria, the removal of financial preconditions will open doors for young and impactful non-profits with innovative solutions but limited operational history. The move is also aimed at encouraging social innovation and enabling public-private partnerships in areas traditionally underserved by the private sector.

Non-profit leaders and procurement experts have welcomed the announcement, calling it a landmark effort to mainstream Section 8 companies in government collaborations. By reducing entry barriers, the government is not only empowering social enterprises but also enriching public service delivery with inclusive, locally driven, and sustainable solutions.