Startup Loan in Nepal: Here’s How Startups Are Selected.

A detailed look at how IEDI evaluates your startup loan proposal, from scoring criteria to factors that make your business stand out.

If you’ve already gone through our earlier guide on applying for the IEDI Startup Loan in Nepal, you know the process seems straightforward. Fill out a proposal, submit it, and wait for the results.

But what really decides whether your name ends up on the approved list isn’t the idea itself. It’s how that idea performs when it’s measured, and it will be measured against a strict evaluation framework that looks at everything from your prototype to your growth potential, use of technology, and financial discipline.

The Industrial Enterprise Development Institute (IEDI) has turned the startup loan program into something methodical and transparent. Every proposal is scored under a defined marking scheme, officially detailed in Schedule 5 of the Startup Enterprise Loan Operation Procedure, 2082.

Understanding that marking scheme is where most founders fall short. It’s what separates those who receive the loan from those who don’t. Not effort, but strategy.

This article breaks down that scoring process line by line: who evaluates your proposal, how each criterion is weighted, and what the committee is really looking for when deciding which startups to fund.

If you’re preparing to apply, this is the part of the process you can’t afford to skip.

But before we get into the details let’s start with the people who decide whether your startup deserves the loan.

Who Actually Evaluates Your Proposal

Every proposal under the Startup Enterprise Loan Program goes through a Proposal Evaluation Committee, a three-member panel that operates under the IEDI. The committee is a well-balanced team designed to judge your business from three crucial angles:

• Business Feasibility: represented by a director or officer-level staff from IEDI (the committee coordinator)
• Financial Viability: represented by a member from Rastriya Banijya Bank (RBB), the government’s lending partner bank
• Technical Soundness: ensured by a subject-matter expert nominated by the central Facilitation and Monitoring Committee

This combination makes sure that your proposal is not only innovative but also practical, fundable, and grounded in sectoral expertise.

Each committee member reviews and scores your proposal independently, and those scores are then averaged to determine your final mark. That means no single person’s opinion decides your fate. Your score reflects a collective assessment.

Think of it as a startup version of a “final jury”, except this one decides who gets low-interest loans at just 3% per annum, not who wins a reality show.

Now that you know who’s doing the marking, let’s talk about how they actually do it.

The Scoring System: How 100 Marks Decide Your Fate

The IEDI has made the evaluation process refreshingly transparent. Instead of vague feedback like “good idea but not feasible,” they’ve laid out a clear 100-mark system divided into two parts:

1. General Criteria (80 Marks): Common for all startups, regardless of sector. This covers your company’s current status, growth potential, technology adoption, financial discipline, and employment generation.
2. Sector-Specific Criteria (20 Marks): Tailored to your industry, depending on whether you’re in agriculture, IT, tourism, infrastructure, or traditional craft.

To get your proposal even considered, you’ll need to score at least 50 marks; that’s 50% of the total. But here’s where it gets interesting: the higher your score, the higher your chances of being recommended for the loan, and often, the higher the amount you can receive.

In the next section, we’ll break down exactly what these 100 marks mean, and how you can structure your proposal to score higher in every category.

General Evaluation Criteria: 80 Marks

So, what exactly do evaluators look for when scoring your proposal for the startup loan in Nepal? Let’s break down the 80 marks that apply to every startup, regardless of industry.

(a) Current Status of the Enterprise (12 Marks)

The committee first looks at where your startup stands today. Are you still refining your idea, or have you already started production?

Here’s how those 12 marks are distributed:

Tip: If you’re still at the prototype stage, highlight your roadmap and testing outcomes clearly. The evaluators want to see proof of progress, not just plans.

(b) Potential for High Growth (10 Marks)

This section answers one question: Can your business grow fast enough to justify public funding?

It’s divided into two sub-parts:

1. Growth Rate (4 Marks): Measured by your turnover growth in the last fiscal year (for existing businesses) or projected growth (for new ones):
   • Up to 25% → 1 mark
   • Up to 50% → 2 marks
   • Up to 100% → 3 marks
   • Above 100% → 4 marks
2. Market Potential & Import Substitution (6 Marks):
   Startups that reduce import dependency or produce goods with high import volume in Nepal gain higher points. If your product replaces imported goods or serves both domestic and international markets, you’re on the right track.
   • Domestic Market → 2 marks
   • Domestic + International Market → 3 marks

Takeaway: If your startup can help Nepal save foreign currency or generate export income, make it a headline in your proposal. It’s one of the fastest ways to climb up the marking ladder.

(c) Adoption and Use of Technology (15 Marks)

In 2025, no evaluator wants to see a “startup” that still relies on pen-and-paper bookkeeping. This section gives up to 15 marks for how you integrate technology across your operations.

1. Status of Technology Use (10 Marks)
   • Electronic accounting system only → 3 marks
   • Technology used in production or processing → 5 marks
   • Technology in production, processing, and storage → 7 marks
   • Technology integrated across all stages (transactions, production, processing, storage, marketing) → 10 marks
2. Technology Development or Transfer (5 Marks)
   • If you’ve developed the technology yourself or successfully adapted/transferred it into your business → full 5 marks

Tip: Mention how your technology improves efficiency, whether that’s faster turnaround, better traceability, or higher quality control. Generic statements like “we use technology” don’t score well.

(d) Source of Raw Materials (10 Marks)

IEDI strongly favors startups that create domestic value chains. This section measures how dependent you are on imported materials:

The startup loan in Nepal aims to strengthen local industries, not increase import dependence. So, if your inputs are sourced locally; say, Nepali coffee beans, wool, or software developers, you stand out immediately.

(e) Presentation of Business Proposal (6 Marks)

This is where your communication skills meet your business idea. The committee pays attention to how you present your plan, not just what’s written in it.

Tip: Don’t read off your slides. Evaluators want to see conviction; that you know your numbers, your challenges, and your market realities. Even a solid business can lose marks here if presented vaguely or overconfidently.

(f) Credit Appraisal of the Enterprise (15 Marks)

This is the financial health check of your startup; as in, how you manage money, risk, and reinvestment. It’s worth as much as the technology section, which tells you how crucial it is.

Tip: Don’t just attach financial statements, but try to interpret them. A simple note explaining your reinvestment ratio or how you plan to manage working capital can make your financials come alive.

(g) Employment Status and Proposed Employment (12 Marks)

Finally, IEDI looks at how much real employment impact your business can create. 

In short: If your startup plans to employ more than 10 people directly; whether in operations, tech, or production, you can secure full marks in the ‘proposed employment’ category.

Total: 80 Marks

When you add everything up; business readiness, scalability, innovation, sourcing, presentation, financial discipline, and employment impact, you get a 360° view of how Nepal measures startup potential.

Now in the next section, we’ll dive into the sector-specific evaluation (20 marks), because what earns full points for an IT startup might barely pass for an agriculture project.

5. The Final 20 Marks: Sector-Specific Evaluation

Once your startup has been judged on the general 80-mark criteria, which everyone faces, the next 20 marks are where your industry expertise comes into play.

Each industry has its own evaluation matrix designed to test how well you understand your domain, your technical background, and your operational readiness.

Think of it like a bonus round; the difference between “qualified” and “recommended.”

Let’s break down how those final 20 marks are awarded depending on your sector.

(a) Agriculture, Forestry, and Production Sector (20 Marks)

If your startup is rooted in farming, livestock, agro-processing, or forestry, this is your scoring matrix. The emphasis here is on grounded experience and infrastructure.

Tip: Attach photos, documents, or certificates of your infrastructure and machinery if possible. Real-world proof earns confidence points that can’t be captured through text alone.

(b) Information Technology and Digital Sector (20 Marks)

If you’re building apps, software, or digital platforms, this section is your real test. IEDI gives weight to education, innovation, and impact.

Tip: The IT sector is where most of Nepal’s new startups are emerging. But it’s also where proposals sound the same. Highlight what makes your technology unique; not just what it does, but how it’s built and who benefits.

(c) Infrastructure and Transport Sector (20 Marks)

This sector focuses on startups involved in logistics, sustainable transport, or small-scale infrastructure development. The key here is partnerships, sustainability, and waste management.

Tip: If your startup incorporates EV mobility, solar logistics, or waste recycling, highlight it boldly. Nepal’s current policy tilt toward green infrastructure means such initiatives align perfectly with IEDI’s vision.

(d) Social Service and Tourism Sector (20 Marks)

This category is designed for startups working in education, healthcare, social entrepreneurship, or tourism, areas that directly improve community well-being or Nepal’s global visibility.

Tip: If your tourism startup helps rural communities earn income, or your edtech platform reaches remote schools, quantify that impact. Numbers (even small ones) make stories powerful.

(e) Traditional and Local Resource-Based Sector (20 Marks)

This category honors Nepal’s cultural and natural roots, from handmade crafts and herbal products to local textiles and traditional foods.

Tip: Storytelling matters here. If your business preserves cultural heritage or empowers rural artisans, emphasize both sustainability and social return, not just profit margins.

What These 20 Marks Really Mean

These final 20 marks often separate good proposals from great ones. They tell evaluators that you’re not just an entrepreneur chasing funding, but you’re someone who understands your field deeply, has invested in learning, and knows how to create value responsibly.

In short, the Startup Loan in Nepal rewards substance over slogans. A fancy business plan without technical grounding will lose to a modest one that demonstrates real expertise, experience, and social impact.

In the next section, we’ll tie it all together, explaining how the final scoring, shortlisting, and bank evaluation come together to decide which startups actually get funded (and how much).

How Final Selection For the Startup Loan in Nepal Works

Once you’ve submitted your proposal and nailed the presentation, the next phase begins, the paperwork-heavy part that actually decides your fate.

The Proposal Evaluation Committee first publishes a list of every application it received, sorted by sector. Then comes the shortlist, a preliminary round where only the proposals meeting all eligibility rules (registration, documentation, compliance) make the cut.

If your name’s there, congratulations, you’re now invited to present your business plan. The schedule and venue (or online link) are announced publicly. These presentations are not a formality; they directly feed into your score.

After the presentation round, your proposal moves to the lending bank, most often Rastriya Banijya Bank, for what’s called a credit appraisal. Within ten days, the bank must conduct an on-site inspection of your startup, check your financials, and submit its own appraisal score back to IEDI.

At that point, two sets of numbers exist:

• your evaluation score from IEDI’s committee (based on the 100-mark system we discussed earlier), and
• your financial appraisal from the bank.

The committee combines both to calculate your final total score.

If any document, video, or claim looks suspicious, the committee can conduct its own field visit to verify everything before making a decision.

And this part is important. The final score decides three things:

1. whether you qualify (you need at least 50 percent overall),
2. how high you’ll be placed in the priority list, and
3. in many cases, how much loan you’ll actually get.

The IEDI team then prepares a recommendation list, and only those who meet or exceed the 50-percent mark stay on it.

How Loan Amounts Are Decided and Disbursed

Now that you’ve cleared the evaluation hurdle, the conversation shifts from marks to money.

Deciding the Loan Amount

Every recommended proposal is reviewed again to determine a suitable loan size, between NPR 5 Lakhs and NPR 20 Lakhs million. The committee doesn’t automatically give you what you asked for.

If your project shows that it can function effectively with less, the amount may be reduced, with clear written reasoning. Conversely, if the committee approves more than 80 percent of what you requested, it must justify the decision explicitly.

After finalization, IEDI publishes the names of successful applicants on its official website and notifies them individually by phone or SMS. Those who are selected have 30 days to contact the lending bank; miss that window, and the recommendation automatically expires.

The Loan Agreement

Before any rupee leaves the bank, a formal agreement is signed between you and the lender. This agreement is more than a legal checkbox, as it defines how your loan will live and breathe over the next few years.

It includes:

• Loan limit and disbursement method
• Installment schedule and repayment period (maximum 5 years)
• Interest rate: fixed at just 3 percent per year
• Repayment process for principal and interest
• Penalties for missed installments
• Monitoring and evaluation provisions

Repayment of principal and interest must begin no later than one year after receiving your first installment, giving you a short but realistic runway to get your startup moving.

Once the agreement is signed, the bank has seven working days to release your first installment. Usually, you’ll get 50 percent of the approved amount upfront.

After that, you’ll need to prove that the money was properly used with receipts, progress photos, or expenditure reports. Once verified, the bank conducts a quick site visit and then disburses the remaining 50 percent.

If any issue arises; say, incomplete documentation or delayed inspection, the bank must notify both you and IEDI in writing within the same seven-day period. IEDI then reviews the case and makes a decision within 15 days, ensuring applicants aren’t left hanging for months.

Every loan disbursed is also reported back to IEDI within a week, maintaining a centralized record of how the Startup Loan in Nepal is being implemented nationwide.

Beyond the Loan

For many recipients, the story doesn’t end at disbursement. IEDI often invites selected entrepreneurs to short training programs on business management, financial literacy, and growth strategy.

These sessions might sound optional, but they’re valuable, the difference between burning through your loan and building a business that can repay it comfortably.

In essence, Sections 12–14 turn a policy promise into an accountable system: structured scoring, transparent selection, and a monitored, low-interest loan designed to give genuine startups a fair start.

Key Takeaways for Entrepreneurs

The Startup Loan in Nepal works less like a grant program and more like a performance review for your business idea. Every step, from proposal to disbursement, is built around structure, evidence, and accountability.

Here’s what that means for anyone preparing to apply.

1. Every Mark Has a Purpose

The 100-mark framework tells evaluators where your startup stands today. It rewards progress and preparation. A team with a working product, customers, and a clear business structure naturally ranks higher than one still testing the waters.

So, instead of thinking about how to “impress” the committee, focus on showing the real progress you’ve already made. The work, the users, and the proof that your idea is moving somewhere.

2. Your Proposal Speaks for You

The proposal is more than a document, it’s your story told in numbers and plans. The strongest ones feel complete, not flashy. They show that you’ve researched your market, tested assumptions, and planned ahead for risk.

If you haven’t already, check out our earlier explainer on how the startup loan process works. It helps you structure your application in a way that aligns naturally with the evaluation criteria.

3. Technology and Local Sourcing Build Credibility

Startups that combine innovation with local value creation score consistently higher. Using Nepali raw materials, collaborating with local producers, or developing home-grown technology gives your proposal depth and purpose.

IEDI’s evaluation model favors startups that make Nepal less dependent on imports, whether through local manufacturing, digital services, or new ways to connect small producers to markets.

4. Financial Discipline Builds Trust

The committee looks closely at how you manage money. If you’ve invested personal funds, planned for reinvestment, or taken steps to insure your business, those details show seriousness.

Numbers matter, but so does attitude. A founder who treats borrowed funds responsibly earns quiet but steady confidence from evaluators, and that often translates into better scores.

5. Employment and Impact Carry Weight

Growth isn’t only about revenue. The number of people your startup can employ, directly or indirectly, tells a powerful story. Creating ten stable jobs can have more impact than chasing a tenfold valuation.

IEDI’s goal through the startup loan in Nepal is to grow businesses that lift local economies, not just individual entrepreneurs. Make that link clear in your proposal.

A System Designed to Build Better Businesses

If there’s one takeaway, it’s this: the evaluation framework trains you to think like a business owner long before you become one. By asking you to measure, justify, and plan, it helps shape the mindset of a founder who knows both the opportunity and the responsibility that comes with public financing.

The Startup Loan in Nepal has turned the idea of “government support” into something smarter, a transparent system that rewards preparedness and integrity.

When you apply, focus less on what the loan can do for you and more on what your startup can prove about itself. Because in this program, the startups that get funded are the ones that already behave like the businesses they aspire to become.

Final Thoughts

The Startup Loan in Nepal is one of the few programs where process and fairness go hand in hand. It rewards founders who’ve done the groundwork, those who can show progress, discipline, and a clear sense of direction.

Every proposal is judged on visible effort: how much you’ve built, how responsibly you plan to grow, and how well your business fits Nepal’s larger economic goals.

For entrepreneurs, that’s both a challenge and an opportunity. If your idea can stand up to this kind of scrutiny, it’s already stronger for it.

The real advantage isn’t the loan alone, it’s the framework that pushes you to think, plan, and operate like a business from day one.

Related Articles:

• Startup Loan in Nepal 2082: Step-by-Step Application Guide
• IEDI Selects 661 Startups* for Startup Loan in Nepal!
• Government Finally Defines “Startup” Business in Nepal
• The Complete & Full Guide on Starting a Business in Nepal