Subsidy Schemes

Subsidy Schemes

Govt has taken various initiative to support the micro, small & medium enterprises (MSME) under various Subsidy schemes. Below are the summarized detail of various  Subsidy schemes.

Prime Minister Employment Generation Program and Other Credit Support Schemes (PMEGP)

The scheme is implemented by Khadi and Village Industries Commission (KVIC) functioning as the nodal agency at the national level.

At the state level, the scheme is implemented through State KVIC Directorates, State Khadi and Village Industries Boards (KVIBs), District Industries Centres (DICs) and banks. In such cases KVIC routes government subsidy through designated banks for eventual disbursal to the beneficiaries / entrepreneurs directly into their bank accounts.


Credit Guarantee Trust Fund for Micro & Small Enterprises (CGTMSE)

Ministry of Micro, Small and Medium Enterprises and Small Industries Development Bank of India (SIDBI) jointly established a Trust named Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) in order to implement Credit Guarantee Scheme for Micro and Small Enterprises. The corpus of CGTMSE is contributed by Government of India and SIDBI. 75% of the loan amount to the bank is guaranteed by the Trust Fund.

Collateral free loan up to a limit of ₹ 200 lakh is available for individual SME on payment of guarantee fee to bank by the SME.

To know more about scheme, Pl. Click here.

Interest Subsidy Eligibility Certificate (ISEC)

The Interest Subsidy Eligibility Certificate (ISEC) Scheme is an important mechanism of funding khadi programme undertaken by khadi institutions. It was introduced to mobilise funds from banking institutions for filling the gap between the actual fund requirements and availability of funds from budgetary sources.

For more details pl. click here

Credit Linked Capital Subsidy for Technology Upgradation (CLCSS)

CLCSS provides 15% subsidy for additional investment up to ₹ 1 cr for technology upgradation by MSEs. Technology upgradation would ordinarily mean induction of state-of-the-art or near state-of-the- art technology. In the varying mosaic of technology covering more than 7,500 products in the Indian small scale sector. To know more about scheme, pl. click here

Important to note that:

  • Units looking to replace existing equipment/technology with the same equipment/technology will not qualify for subsidy under this scheme.

  • Units upgrading with used machinery would not be eligible under this scheme.

Important Note

Financial Support to MSMEs in ZED Certification Scheme

The objectives of the scheme include inculcating Zero Defect & Zero Effect practices in manufacturing processes, ensure continuous improvement and supporting the Make in India initiative.The subsidy provided by the Government of India for Micro, Small & Medium Enterprises will be 80%, 60% and 50% respectively. There shall be an additional subsidy of 5% for MSMEs owned SC/ST/women and MSMEs located in NER and J&K for assessment & rating/re-rating/gap analysis/hand holding:

To Know More About Scheme, Pl. Click here.

FAQ for Schemes

Who Can Take loan Under PMEGP Scheme ?

The Loan Under PMEGP Scheme can be taken by entrepreneurs, Institutions, co-operative societies & Trust.

What is The subsidy amount amount under PMEGP Schemes ? 

The subsidy amount depends upon the quantum of funding avail under the scheme. subsidy is contributed by government to a business. this subsidy is given to the bank and is subject to lock in period of 3 years.

Who can avail fund under the CGTMSE scheme ?

New and Existing MSME entities can avail fund under the CGTMSE scheme

Can the borrower directly approach trust to seek guarantee for the credits sanctioned by lenders ?

CGTMSE gives guarantee to its MLIs. Therefore, MSME entities have to approach the Banks or financial institutions with their proposal and credit requirements.

what is the quantum of credit facility covered under the schemes ?

credit facilities up to 200 lakh per eligible borrower are covered under the guarantee scheme

What is Credit Linked Capital Subsidy for Technology Upgradation (CLCSS) Scheme ?

It is Credit Linked Capital Subsidy Scheme (CLCSS) for technology
upgradation/purchase of new machine of SME enterprises.

How Much Subsidy CLCSS provide ?

CLCSS provides 15% subsidy for additional investment up to ₹ 1 cr for technology upgradation by MSEs.

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