Facebook-owned WhatsApp on Monday announced to invest $250,000 worth ad credits into the Indian startup ecosystem to help entrepreneurs better connect with customers and grow businesses.

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The investment will provide 500 startups approved by the Department of Industrial Policy and Promotion (DPIIT) with $500 each of Facebook ad credits.

With the credits, startups can create ads that invite customers to click to open a chat on WhatsApp so they can deepen connections and increase sales, the company said in a statement.

"India's entrepreneurs are at the forefront of bringing impactful social and economic change, and we at WhatsApp are committed to providing them support in achieving success," said Abhijit Bose, Head of WhatsApp India.

In order to be eligible, startups must be at early traction or scalable stage and must be recognized by DPIIT. Selection will be on the first-come-first-serve basis and once registered, the first 500 entries will receive free Facebook ad credits worth $500, said WhatsApp.

Currently, one million businesses in India are actively using the WhatsApp Business app to have a meaningful conversation with their customers.

Globally, five million businesses are using WhatsApp for the same purpose.

The investment is part of a tie-up with Startup India, a flagship initiative of the government that was launched in 2016 to build a strong ecosystem for nurturing innovation in the country.

"India is at an inflection point and as the second-largest community of startups in the world, our focus has always been to support the ecosystem and promote innovative solutions to today's challenges," said Deepak Bagla, CEO and MD, Invest India.

The investment comes on the heels of the "Startup India-WhatsApp Grand Challenge" where WhatsApp awarded five Grand Challenge winners with a grant worth $50,000 each (nearly Rs 35 Lakh).

"The Startup India portal has played a pivotal role in enabling the ecosystem to drive inclusive growth and we're constantly working to support the next generation of Indian innovators with partners like WhatsApp," Bagla added.

In three years, over 19,000 startups have been registered with the Startup India programme across 513 districts.