Kathmandu. Although most of the start-ups in Koshi Province are facing problems like lack of adequate capital, skilled manpower, market access and facilities from the government, they are getting good results, according to a study. According to the ‘Trend of Startup Enterprises in Koshi Province Special Study 2081÷82’ released by Nepal Rastra Bank on Monday, 80 percent of the start-ups in Koshi Province are making profit.

The NRB has prepared the report by identifying the business nature of start-ups, sectoral trends, access status of resources required for start-ups and the problems faced by such businesses. According to the NRB, data has been collected from 160 start-up enterprises based on the number of enterprises that have applied for startup loan at Industrial Business Development Academy and are shortlisted in Koshi Province.

The 160 enterprises included in the study include five business sectors—agriculture and forestry, production, service-oriented, tourism and information technology. Among them, 41.3 per cent are related to agriculture and forestry, 18.1 per cent related to production, 17.5 per cent related to service, 13.8 per cent related to tourism and 9.4 per cent related to information technology.

According to the report, 43.1 per cent agriculture and forestry, 21.3 per cent tourism, 13.8 per cent production-oriented, 10 per cent service-oriented, 8.1 per cent information technology and 1.9 per cent energy and construction sectors have been identified as the sectors with high commercial potential. Among such startups, 54 percent have used innovative thinking and innovation in the goods and services, 41 percent in the production process and five percent in the distribution process.

The group of 21-35 years accounted for 39.3 percent of the start-ups, 44.4 percent of the entrepreneurs in the 36-50 age group and 16.2 percent of the entrepreneurs in the 50-70 age group. Among them, 74.4 per cent are male and 25.6 per cent are female.

Among the reasons cited as motivating start-ups to start their business, 37.1 percent would like to be self-reliant, 25.8 percent wanted to contribute to society, 25.1 percent new opportunities, 7.9 percent lack of employment and 4.1 percent other reasons.

The 160 start-ups included in the study have a total investment of Rs 2.56 billion. Of this, 38.7 per cent is debt and 61.3 per cent is self-capital. Similarly, 40.6 percent enterprises have received government grants and facilities while 59.4 percent enterprises have not received any government grants and facilities.

The study also highlighted the problem of market access for products produced by start-ups. “According to the analysis of the enterprises included in the study, 45 percent of the enterprises have a major market in the local market. According to the report, 46.9 percent enterprises are exporting their goods and services to the national market and 8.1 percent to the international market.

In terms of use of technology, 27.5 percent enterprises use high technology, 65 percent enterprises use general technology and 7.5 percent enterprises do not use technology. The highest number of such enterprises, 33.9 percent, use friends and relatives for the marketing of their products.

Similarly, 28.3 per cent social networks, 8.5 per cent websites, 7.2 per cent online advertising and fair÷festival, six .1 per cent traditional media, 4.5 per cent door-to-door contact and 4.3 per cent other methods.

These enterprises employ 48.4 per cent women and 51.6 per cent of men, the report said. The NRB has also suggested steps to be taken for the promotion of start-up enterprises.

“Seed capital, co-investment model, venture capital, tax exemption, legal simplification and easy access to credit are essential for startups. In addition, incubation centers, special incentive programs and financial literacy initiatives at the federal, provincial and local levels should help entrepreneurs to invest and enter the market,” the report stated.