Chinese taxpayers are helping to underwrite tech start-up risks
- The programme offers up to US$1.4 million to cover research and development costs in failed start-up projects
“You set up the business, I shoulder the risks.”
It sounds too good to be true? It is no scam, but a real programme rolled out in China to encourage entrepreneurship.
This start-up insurance scheme launched in Hangzhou offers up to 10 million yuan (US$1.4 million) to cover research and development costs in failed projects, as well as provide an allowance of up to 30,000 yuan each on living expenses for distressed entrepreneurs, according to a report by Chinese news agency Xinhua on Monday.
The Zhejiang provincial government jointly developed the programme with the state-owned People’s Insurance Company of China and Shanghai-based China Pacific Insurance Co. It was established as a protection mechanism to help relieve start-ups from some financial risks, while spurring more entrepreneurs to create and build innovative businesses, according to the Xinhua report.
The local government will shoulder up to 300,000 yuan of the insurance cost for each start-up, depending on the type of project being pursued, the report said.