Are you a Micro and Small Enterprise (MSME) looking for a government scheme that can help you scale up? FineTrain has compiled a list of schemes for MSMEs and entrepreneurs across various industries.
This blog has three sections; first section discusses the schemes that are common across all industries, second section talks about industry specific schemes and third section explains schemes for specific category of entrepreneurs such as women.
Common Schemes for all industries
|Area/Topic||Scheme details||How to avail these schemes?||Remarks|
|Upgrading Technology||Credit linked capital subsidy scheme by the office of development commissioner MSMEThe scheme provides a subsidy of up to 15 lakhs for purchase/up gradation of selected machines across all MSME industries.||The proposal under CLCSS has to be sent to the bank.Please check FineTrain blog (http://finetrain.com/clcss-avail-a-subsidy-on-your-investment/)||Banks are favourably disposed towards this scheme as it is generally given to established enterprises|
|Business Development||Market development assistance by the office of development commissioner MSME (DC MSME) The scheme entails reimbursement of air fare (up to 75%) to participate in international exhibitions and 50% of stall charges, stall charges in domestic trade exhibitions are also reimbursedAssistance in bar coding- Reimbursement of 75% of one time registration fee and annual certification fee for three yearsFee paid to register with GS1 India (a barcoding service provider)||Contact nearest District Industry Centre (DIC) or MSME development institution (MSME DI)||MSME development institutes typically work with industry associations|
|Improving quality/obtaining quality certifications||Reimbursement of charges spent on acquiring quality certificates (ISO 9000, ISO 140001 and HACCP (A quality certification for food processing enterprises) The maximum reimbursement is limited to 75% of actuals or 75,000 in each case||Proposal to be submitted to MSME development institutes|
|Getting infrastructure such as common testing lab, effluent testing facilities||Grant for setting up common facilities for an industrial cluster as part of Cluster Development Programme (CDP) by the office of development commissioner MSME.||Can be availed only if there are more than 25 enterprises looking for common facilities. One can contact cluster development consultant such as “Foundation for MSME clusters”.||This can be time consuming, as it involves bringing many enterprises together|
|Collateral free funds/low interest funds||Credit guarantee trust for Micro and Small Enterprises (CGTMSE)A collateral free loan of up to Rs. 1 crore||Apply to the nearest public sector bank branch, difficult to avail a loan under this scheme for amount exceeding Rs. 10 lakhs||Recommended for loans up to Rs. 10 lakhs|
Schemes related to specific industries
Now let us talk about schemes that promote specific business such as food processing, dairy, solar technology, information technology, sericulture, cold storage, fisheries.
|Industry/Sector||Scheme||How to avail the scheme?|
|Animal Husbandry||Dairy entrepreneurship development scheme from NABARD 25% subsidy (on the project cost) is provided on a number of activities related to dairy such as dairy farm, purchase of dairy processing equipment, cold storage facilities.https://www.nabard.org/uploads/merged_document.pdf||The proposal has to be submitted to public sector banks, who in turn will apply to NABARD for subsidy.|
|Agriculture||A number of schemes from APEDA (Agriculture and processed food products export development body) providing a grant of up to 40% of project cost for Setting up infrastructure related to handling of agricultural produce. The infrastructure includes facilities for handling, storage, transport of agricultural cropsGrant for acquiring quality certifications, setting up testing labsReimbursement of expenses for training for the staff of exporters||Schemes are available only for exporters of agricultural products (specified by APEDA). One has to register with APEDA. One needs a track record of at least three years of export.|
|Textile||Technology up gradation Fund scheme from Ministry of TextilesA combination of interest cost reimbursement(up to 5%,) and capital subsidy (up to 15% of investment in machinery) for existing and new units in weaving/spinning /garment/technical textile/handlooms/Jute sector.http://www.ministryoftextiles.gov.in/faq/faq_tuf.pdf||Available to both existing and new units.Application has to be made to the nodal bank|
|Leather||Integrated development of leather sector (ILDS) Provides up to 30% subsidy on cost of machines to Micro and small enterprises and 20% subsidy to others. The subsidy capped at Rs. 2 crore per product line.· Modernization of tanneries· Modernization of footwear & footwear components units· Modernization of leather product units· Modernization of Harness & saddlery units||The scheme is available to existing units, with at least 2 years of cash profits. The application has to be made to public sector banks|
|Micro business up to 25 lakhs||Prime Ministers employment generation program (PMEGP), provides 25 to 35% of subsidy for projects under 25 lakhs.http://finetrain.com/subsidy-on-business-loans-under-pmegp/||PMEGP invites application through a newspaper ad in July/August. Entrepreneurs are selected through an interview.|
|Information technology/digital sector||NASSCOMs 10,000 start-up programmeThe selected applicants are provided co working space, mentorship and an opportunity to pitch to investors||Apply through NASSCOM website|
|Information technology||NASSCOM’s Start up warehouse programmeCurrently available in Bangalore and Calcutta. The start-ups are provided co working spaces and infrastructure||Apply through NASSCOM website|
|ITES||Department of electronics and IT (DietY) ‘s scheme for promotion of BPOs in North East region https://www.stpi.in/writereaddata/mainlinkfile/4564974058nebps.pdf The scheme proposes to fund 50% of the capital expenditure (maximum Rs. 1 lakh per seat) in setting up a BPO in the NE region.||STPI (Software technology parks of India) invites bids on behalf of DietY . Bidders need to submit technical and financial bids.|
|Electronic goods||Scheme by department of electronics and IT (DietY)The scheme covers reimbursement of charges incurred towards a getting the products tested for quality for domestic market and exportshttp://deity.gov.in/sites/upload_files/dit/files/Notification2.pdf||Application has to be made to DietY|
Schemes for women and minority entrepreneurs
|Category of entrepreneurs||Scheme details||How to avail these schemes?|
|Women||Higher subsidy to women under PMEGPInvestment subsidy/Seed capital schemes of state governmentsBank schemes for women entrepreneurs||In order to avail of these schemes, women need to be the majority owner/single owner of the enterprise.The state governments offer a number of incentives such as investment subsidy, seed capital through their industrial policies Stree Shakti from SBI ( lower margin money at 20% of loan amount, no collateral up to loan value of Rs. 5 lakhs)Cent Kalyani from Central bank (lower margin money at 20% of total loan amount, no processing fee)Other public sector banks also offer similar schemes|
|SC Entrepreneurs||IFCI Dalit entrepreneur fund Incentives from the state governments||A fund for SC entrepreneurs, the fund invest in both debt and equity capital. Minimum size is Rs. 50 lacs. The enterprise should be at least 1 year old and SC entrepreneurs should own at least 60% of stake in it.All state governments offer benefits such as investment subsidy, seed capital to SC/ST entrepreneurs|
|SC entrepreneurs||National Scheduled Castes Finance and Development Corporation (NSCFDC) schemesState SC cooperative finance corporation schemes||NSCFDC provides loans (up to Rs. 30 lakhs) at concessional rates (ranging from 2 to 10%) to SC entrepreneurs from poor economic background with annual income of less than Rs. 1 lakh per anuum.Both AP and Telangana have state cooperative finance corporations. Their schemes provide credit linked subsidy for loans up to 2 lacs. The subsidy is up to 50% of the project cost or 30,000 (whichever is less), balance is met through bank loan and entrepreneurs contribution.|
How to choose among various schemes?
The scheme selection should be done based on the following parameters
Coverage under scheme– If you are starting a project that is covered by a specific ministry such as ministry of food processing, solar technology, it is always beneficial to apply as part of such programme, rather than a general scheme such as CGTMSE, PMEGP
Time taken to get the funds– The time taken to get the funds could be very high up to 1 year in some of the schemes such as PMEGP
How can FineTrain help you?
Help you understand eligibility and select among a number of schemes
Assist you finetune you project proposal/ application form for subsidy
Provide other support till the loan is disbursed