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MSME Schemes


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MSME Schemes

In India, there are approximately 6.3 crore MSMEs which involve in national and international trades, contributing about 29% towards GDP. MSMEs contribute to the economic and social growth of the nation and are a great way to decrease unemployment issues and promote local products. Our government understands the difficulties that every micro, small and medium business owners face in various stages of their business development process and the importance of MSMEs for the development of the country. Hence has structured various schemes to provide maximum support for each and every budding entrepreneur and MSMEs in every possible way to ease out every phase of their business.

1. Prime Minister Employment Generation Programme and Other Credit Support Schemes

With the education rate increasing year by year, unemployment problems are also soaring high. This scheme is structured with the motto of eradicating the unemployment issue and motivating emerging new businesses by providing necessary financial support.

Prime Minister Employment Generation Programme (PMEGP):

Implemented by Khadi and Village Industries Commission (KVIC) at the national level and through State KVIC Directorates, State Khadi and Village Industries Boards (KVIBs), District Industries Centres (DICs) and banks at the state level, the motto of this scheme is to make every eligible thriving entrepreneur get a subsidy in their bank account for developing a new business. Under this scheme, any new project in the manufacturing sector worth up to ₹ 25 lakhs and a new business/service sector worth up to ₹ 10 lakhs gets covered.


*Age above 18


*A maximum cost of the project should not be more than ₹ 25 lakhs for manufacturing projects and up to ₹ 10 lakhs for the business/service sector.


*For projects with an estimate of Rs.10 lakh in the manufacturing sector and above Rs. 5 lakh in the business/service sector, the beneficiary should have at least VIII standard pass.


*Only new projects are eligible


*Self Help Groups, Institutions registered under Societies Registration Act (1860), Production Co-operative Societies, and Charitable Trusts are also eligible apart from Individuals.

Application Process

*The State/Divisional Directors of KVIC give advertisements via local media, radio and prints to invite applications.


*You can also submit your application online at https://www.kviconline.gov.in/pmegpeportal/pmegphome/index.jsp

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

A promising scheme for micro and small enterprises, this CGT SME scheme provides credit-guaranteed funds to eligible beneficiaries from a Trust that is jointly established by the Ministry of MSME and Small Industries Development Bank of India (SIDBI).


*Both new and existing enterprises are eligible

*Only Individual Micro and Small Enterprises are eligible

Application Process

You can visit banks and financial institutions which are eligible to provide loan under this scheme

Interest Subsidy Eligibility Certificate (ISEC):

To promote Khadi and Village Industry products, the government has shaped this effective scheme. With this scheme, any registered institution of KVIC or KVIB can avail loan from banks at a 4% p.a interest rate to develop their business. The lending bank gets the 4% interest from the beneficiary and the remaining part of the interest is remitted by the Central Government through KVIC.


Any registered institution of KVIC or KVIB can avail the loan.

Application Process

You can apply in any recognized bank/financing institutions along with the ISEC certificate issued by KVIC.

2. Development of Khadi, Village and Coir Industries

To make way for the rural crafts and products to lend their part in the economic development of the nation and to uplift the rural population, several schemes have been introduced by the Ministry of MSME.

Market Promotion & Development Scheme (MPDA):

Like any other business, Khadi and village crafts too need some marketing strategy to reach the potential customers. With the motive of promoting Khadi crafts and increasing the income of artisans, this MPDA scheme is developed.


*Institution should have valid Khadi certificate

*The institution should be categorised as A+,A,B and C

Application Process

The production Institution can claim the total amount from the KVIC and should be distributed to the stakeholders.

Revamped Scheme of Fund for Regeneration of Traditional Industries (SFURTI)

With the motto to regenerate traditional industries, emphasizing traditional skills and to ensure long-term sustainable income for rural artisans, the Ministry of MSME has designed this scheme. Under this scheme, artisans will be clustered and importance is given to enhancing product development, productivity, competitiveness, product intervention and even packaging and marketing. Local artisans and entrepreneurs are provided with sufficient training and improved tools to face the upcoming challenges to optimize their income.

Depending on the number of artisans, the clusters are classified as

  • Heritage cluster which includes 1000-2500 artisans
  • Major cluster which includes 500-1000 artisans
  • Mini cluster which includes up to 500 artisans

Based on its functionality, this Scheme can be classified as “soft interventions‟, “hard interventions” and “thematic interventions‟.

  • Soft interventions include awareness training and marketing strategies like providing general awareness, counselling, skill development, organizing exposure visits, market promotion campaigns, product development, training programs, etc.
  • Hard Interventions include physical structures like creation of facilities for multiple products, packaging, common facility centres (CFCs), Raw material banks (RMBs), developing infrastructure like training center and warehouse, etc.
  • Thematic interventions emphasizes on both domestic and international markets and implement new strategies for brand building, media marketing and e-Commerce.


Any Non-Government Organizations (NGOs), Institutions of the Central and State Governments and, Semi-Government institutions, field functionaries of State and Central Govt., Panchayati Raj institutions (PRIs), and similar agencies that are expertise in cluster development are eligible for this scheme.

Application Process

You can submit the proposal to the State Office, KVIC. The proposal will be verified at State Level and Zonal Level before being submitted to the Scheme Steering Committee for approval.

Coir Vikas Yojana (CVY):

Coir industry is yet another rural business that profits around 7lakhs artisans by providing them employment and livelihood. In our country, coir and coir-related products are exported to 110 countries. Though benefiting towards the development of the country by making a huge profit in export, the coir industry needs attention and support for its survival and improvement. Hence several schemes are devised as action plans.

Coir Industry Technology Upgradation Scheme (CITUS)

A replacement of “Development of Production Infrastructure” of Coir Vikas Yojana, CITUS provides financial support for entrepreneurs for procurement of machinery in establishing new plants or for upgrading/modernizing existing plants.


*Any coir production/processing unit that is newly established

*Any coir production/processing unit registered with Coir Board under Coir Industry (Registration) Rules, 2008 and having Udyog Aadhar can apply for modernization/upgrading.

Application Process

You can submit the application online with all relevant documents prescribed.

Science and Technology (S&T) for Coir:

The main aim of this scheme is to ensure proper research work and training of entrepreneurs to stay in line with the current technology. The twin research institutes: the Central Coir Research Institute that is located in Kalavoor and Central Institute of Coir Technology that is located in Bangalore receives funds under this scheme to undergo latest research works whose outcomes serve as an aid to train entrepreneurs in coir industry for improved productivity and quality of products and thereby increased income.


The Central Coir Research Institute, Kalavoor and Central Institute of Coir Technology, Bangalore are eligible.

Application Process

If you are a manufacturer or worker in a coir-industry, you can contact the research centers for assistance.

Skill Upgradation and Mahila Coir Yojana (MCY):

A scheme for providing self-employment opportunities to women in coconut producing states, this MCY scheme strives to educate rural women about coir processing and coir-products manufacturing. The National Coir Training and Design Centre (NCT&DC), Kalavoor, Alleppey and Research-cum-Extension Centre, Thanjavur, and Field Training Centres of Regional Officers/ Sub Regional Offices of the Board located at various parts of the country play an active role in training women entrepreneurs.


Workers in coir industry

Application Process

Trade Associations, Unit Owners, NGOs, Co-operatives and Industries Department can recommend candidates for training. The officer-in-charge of the Regional Extension Centre will finalize the candidates eligible for the training.

Export Market Promotion (EMP):

Apart from marketing the coir products locally, exporting those local-made products to various countries is sure to reap the artisans with higher profits. Understanding this, the Coir Board is implementing various export market promotion activities such as funding for publicity, participating in seminars, conferences and international fairs and presenting awards in the export sector as a token of recognition.


Any manufacturer, entrepreneur or exporter in the Coir industry is eligible under this scheme

Application Process

You can get the application forms from the Coir Board HO or can download from the website http://coirboard.gov.in/ to apply for this scheme

Domestic Market Promotion (DMP):

This scheme is a milestone of Coir Board in popularizing coir products within the country to help workmen and entrepreneurs in the coir industry. As part of this scheme, high-end showrooms are established, maintained and renovated. To showcase the products to the local customers, various fairs and exhibitions are conducted, exclusively for coir products, and are publicized by newspapers, television, radio and other media. Apart from that, the board takes steps in improving the quality of the products by fixing quality standards and regularizing inspection and certification processes.


Apex Co-operative Societies, Central Co-op. Societies, Primary Co-operative Societies, Public Sector Enterprises, franchisees appointed by Coir Board in the coir industry and the Showroom and Sales Depots / Hindustan Coir of the Coir Board are eligible for this scheme.

Application Process

You can get the application forms from the Coir Board HO or can download from the website http://coirboard.gov.in/ to apply for this scheme

Trade and Industry Related Functional Support Services (TIRFSS):

Statistics is the backbone for the good planning of any business. As part of improving the coir industry, a reliable IT-related management information system is built for collecting and processing data related to production, productivity, labour infrastructure, raw material, marketing, etc. In the coir industry and to provide feedback for futuristic planning.


All Board’s officials, stakeholders, manufacturers, workers and major market players in the coir industry can avail this benefit.

Application Process

You can approach the Head Office and Regional Offices of the Board to avail the service.

Welfare Measures -Pradhan Mantri Suraksha Bima Yojana (PMSBY):

Accidents and unexpected incidents are part of every business. To make sure the workers and their family are protected against accidental death, permanent total disability and permanent partial disability, the Coir Board has been implementing Coir Board Coir Workers Group Personal Accident Insurance Scheme from 1998 which provides insurance coverage under such circumstances.


*Any coir worker who is self-employed, employed under the SFURTI coir clusters, engaged in the units already registered with the Board, coming under the fold of Welfare Fund Board, PSUs, Corporations, Federations, Cooperative Societies, etc. is eligible for this scheme

*Should fall within the age of 18 to 70 years *Should have Aadhar linked Savings Bank account

Application Process

Eligible worker will be allowed to join in the scheme only through Aadhar linked savings bank account.

3. Technology Upgradation and Quality Certification:

Quality and continuous improvement have a major impact on the development of any business/industry. While there should be a proper channel for quality certification to ensure reliable outcomes each time and every time, up-gradation in terms of technology, marketing and resources make the industry bloom to its highest potential. Hence, certain schemes are established to pave the right path in technology and upgradation.

Financial Support to MSMEs in ZED Certification Scheme:

“Make in India” is a great revolution that supports the local artisans and makes us feel proud to be Indians. While artisans are provided with necessary funds and support to establish new MSMEs and continue traditional businesses under various MSME schemes, it is also necessary to ensure the quality of their outcome.

Aiming towards flawless products is the Zero Defect & Zero Effect (ZED) manufacturing system which targets in reducing waste thereby increasing productivity and income. By providing Financial Support to MSMEs in ZED Certification Scheme, every MSME will work towards complying with quality standards, adopt new quality tools & systems and frequently upgrade their quality standards.


Any manufacturing MSME having Udyog Aadhar Memorandum is eligible.

Application Process

*It is really simple to register on the online portal of ZED (www.zed.org.in) http://assessment.zed.org.in/Assessment/Assessment_BeforeLogin.aspx, using the valid (Indian) mobile number and email address.


*The Online self-assessment on the ZED parameters will be followed by Desktop Assessment. If selected then site assessment will be done.


**Note that the rated MSMEs can avail the service of an authorized ZED consultant for gap-analysis and handholding.

A Scheme for promoting Innovation, Rural Industry & Entrepreneurship (ASPIRE):

To facilitate innovation in the MSME sector, especially promoting new business for un-met social needs and provide employment to fresh minds is the motto of ASPIRE.


Technical / research institutes can serve as knowledge partners for commercialization.

Livelihood Business Incubators/Technology Business Incubators and Incubation schemes of MSME / NSIC / KVIC / Coir Board / Other Ministries/Departments as well as Private incubators.

Application Process

You can send your application to Aspire Scheme Steering Committee of the Ministry of MSME.

National Manufacturing Competitiveness Programme (NMCP):

This scheme aims at enhancing the competitiveness of the manufacturing units in the MSME sector.

Credit Linked Capital Subsidy for Technology Upgradation (CLCSS):

To let every entrepreneur in the MSME sector upgrade their technology wing, this scheme is a great boon.



Application Process

 You can approach SIDBI, NABARD, SBI, BoB, PNB, BOI, SBBJ, TIIC, Andhra Bank, Corporation Bank, Canara Bank and Indian Bank.

Marketing Support/Assistance to MSMEs (Bar Code):

The main aim of this scheme is to encourage MSMEs to use bar codes. Seminars are conducted to train the importance and the registration fee for barcoding is reimbursed to initiate active participation.


Any MSE with and registration with GS1 India for use of barcode.

Application Process

Once you have registered for use of barcode for products, you can get the application form from the Director, MSME-DI, or download it from http://www.dcmsme.gov.in/ and submit the filled form to the office of MSME-DI.

Lean Manufacturing Competitiveness for MSMEs:

Lean is a technique that is widely accepted by successful manufacturing units to improve productivity and work style. To introduce and make effective use of Lean in MSMEs, the ministry has devised this scheme.


*Any manufacturing MSEs that have formed an MC (Manufacturing Consultant).

*A group of SMEs are eligible for the scheme.

*A Memorandum of Understanding MoU is required.

Application Process

A recognised SPV or a mini-cluster formed by a group of 10 or more units can apply to the National Monitoring and Implementing Unit (National Productivity Council for the Scheme).

Design Clinic for Design Expertise to MSMEs:

New design strategies are sure to give a new dimension to any business.  To motivate new strategies in MSMEs, the ministry has formulated this scheme.


Expert agencies, MSMEs or groups of MSMEs can apply

Application Process

You can submit a proposal to the Design Clinic Centre or apply online at


Technology and Quality Upgradation Support to MSMEs:

Making improvements is an unavoidable part of a successful business. Hence to motivate MSME entrepreneurs to take necessary steps towards technical ad quality improvement, this scheme is formulated. The scheme aims mainly towards using energy-efficient technologies (EETs) in manufacturing which will drastically decrease the cost of production.


*Expert organisations like PCRA, BEE, TERI, IITs, NITs, etc.
*State Govt. agencies like MITCON, GEDA, etc.
*Cluster/industry based associations of MSMEs
*NGOs and Technical Institutions.

Application Process

Applicant can apply in the specified format along with required documents for re-imbursement of fees to MSME-DI concerned.

Entrepreneurial and Managerial Development of SMEs through Incubators:

This scheme is a welcome note for new ideas in the MSME sector in terms of technology, process, product, etc. that can be implemented within a year time span.


*Any individual or MSME with innovative ideas

*Any technical institution who is ready to serve as a host institution

Application Process

*Any technical institution that is willing to become a host institution can apply in response to the Request for Proposal (RFP)/ Expression of Interest (EoI).


*Any individual or MSME can visit their nearest host institution to apply directly.

Enabling Manufacturing Sector to be Competitive through QMS&QTT:

Be it a product or a service quality matters. That is why these schemes are established to motivate manufacturing sector to adopt latest Quality Management Standards (QMS) and Quality Technology Tools (QTT).


Expert organiztions, Quality Council of India (QCI), National Recruitment Board for Personnel and Training, Consultancy Development Corporation, National Productivity Council, Standardisation, Testing & Quality Certification (STQC, a Society under the Ministry of IT), IIQM (Indian Institute of Quality Management), Industry Associations that have taken active interest in QMS/QTT, Technical Institutions, Engineering Colleges, Tool Rooms and similar bodies and MSEs

Application Process

You may contact Office of the DC- MSME or refer the link www.dcmsme.gov.in/schemes/QmsQtt.htm for further details

Building Awareness on Intellectual Property Rights (IPR):

Innovative business ideas and strategies need to be protected as they are what going to add uniqueness to your business. This scheme concentrates on creating awareness among MSMEs about Intellectual Property Rights and the need of protecting it.


Registered MSME units, associations, consultancy firms, expert agencies etc.

Application Process

Application forms are provided at: www.dcmsme.gov.in/schemes/IPRDetail.html

4. Marketing Promotion Schemes:

To enhance the marketing strategies for the betterment of MSMEs, few schemes are established by the ministry of MSME.

International Cooperation Scheme:

Though hitting the international market is a bit tricky, it is worth the investment of money, time and energy. The same is applicable in the development of MSMEs too. The government has devised this scheme to enhance international marketing by providing support for MSMEs to participate in international exhibitions/ trade fairs, conferences/ summits/workshops etc. To explore more about the industry and to market the products abroad.


Government Institutions and Registered Industry Associations associated with promotion and development of MSME sector.

Application Process

You can sent applications in the prescribed form to the Director (International Cooperation), Ministry of MSME, Udyog Bhawan, New Delhi -110011.

Marketing Assistance Scheme:

Organizing exhibitions, buyer-seller meets, intensive campaigns and marketing promotion activities are the major emphasize of this scheme apart from co-sponsoring exhibitions and participating in exhibitions abroad as part of marketing the products of MSMEs.


MSMEs, Industry Associations and other organisations related to MSME sector are eligible

Application Process

Applications should be submitted to the Branch Manager of the nearest National Small Industries Corporation

Procurement and Marketing Support Scheme (P&MS):

This scheme is an initiative to encourage Micro and Small Enterprises (MSEs) to develop domestic markets and to educate MSMEs about the possibilities of business development, trade fairs, latest market techniques.


Individual MSEs in Manufacturing/Service sector

Application Process

You can submit your application online

Entrepreneurship Skill Development Programme (ESDP):

Skill development is an important aspect which helps you stay in track with the latest trend and competition. This scheme nurtures the natural talent and educate young entrepreneurs about latest strategies to help them create a successful business.

  • 20 % of the ESDPs are conducted exclusively for weaker sections of the society i.e. (SC/ST/women and PH).
  • A stipend of Rs.500/- per month per candidate is provided.
  • Candidates are not charged for fees.

Assistance to Training Institutions (ATI):

National level training institutions operating under the Ministry of MSME, namely, NIMSME, KVIC, Coir Board, Tool Rooms, NSIC & MGIRI, who take part actively in training young entrepreneurs, are provided funds to develop and improve infrastructure.


Institutions of Ministry of MSME and existing State level EDIs.

Application Process

You can send your applications to the Director/Deputy Secretary (EDI), Ministry of Micro, Small and Medium Enterprises, Udyog Bhawan, Rafi Marg, New Delhi – 110 011

Micro & Small Enterprises Cluster Development (MSE-CDP):

While working as a cluster productivity and competitiveness is sure to boost up a notch. Hence this scheme provides financial support for the establishment of Common Facility Centres (CFCs) for testing, training centers, R&D, Effluent Treatment, raw material depot, complementing production processes, etc. and improving existing industrial areas/clusters.


Clusters, Industrial associations/Consortia

Application Process

*Online applications are available at https://cluster.dcmsme.gov.in


*Hardcopy of applications are to be sent through State Governments or their autonomous bodies or field institutes of the Ministry of MSME

On what base do enterprises categorized as micro, small and medium enterprises?

Both manufacturing and service sectors are categorized as micro, small and medium based on their investment as shown below.






< Rs.25 lakh

< Rs.5 crore

< Rs.10 crore


< Rs.10 lakh

< Rs.2 crore

< Rs.5 crore

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msme schemes india

Government MSME Schemes for Entrepreneurs FAQs:

1. What is an MSME loan?

Micro, Small amd Medium Enterprises loan is a loan provided by banks and schemed by the government to engage individuals in the manufacture and production of goods, preservation of products and setting up markets of goods. The government MSME loan can be availed by any individual who is running an enterprise under the funding as specified below: • Micro Enterprises-Funding not more that 1 crore • Small Enterprises-Funding not more that 10 crore • Medium Enterprises-Funding not more that 20 crore

2. Is the borrowing of funding collateral free?

Yes, many schems mentioned above are collateral free.

3. How does the schemes help in technological needs and advancement?

Under many of the schemes, it is covered that 15 % capital subsidie is provided to the MSM enterprise for upgradation of technological needs.

4. What support is offered for any form of cluster development?

Some schemes provide counselling, awareness through workshops, seminars, and training about cluster development of MSMEs.

5. How does the schemes provide help in skill development

The schemes and the Ministry covering the scheme’s various kinds of training modules and workshops, programmes that support all forms of way of self-employment and growing businesses.

6. Why is competitiveness in MSME sector important?

The competition between different MSMEs ensure that the quality of products made is maintained and doesn’t fall short.

7. How do I know which loan I am eligible to apply for?

Visit the official website of the Ministry to know more about the eligibility – https://msme.gov.in/all-schemes

8. What is the purpose of MSME schemes?

Unlike large enterprises and corporates, MSMEs will not have sufficient funds, awareness and marketing policies. Hence to support entrepreneurs in the best possible way, the ministry of MSME has come up with various MSME schemes.

9. How to ascertain the investment on machinery and plants?

Your total investment in machinery and plant is linked to the tax returns filings on your income you paid last year. In case of your business being a new venture, the tax-filing will be according to your self-declaration. At this point you should keep in mind that as soon as your business’s 1st income tax return is filed, this relaxation ends for you.

10. Is MSME registration mandatory for a business venture?

No, MSME Registration is not mandatory, rather it is voluntary.

11. Shall the applicant get a hard copy of the MSME registration certificate?

No, as the Indian Government is laying more emphasis on paperless work in order to protect our precious environment, the applicant will receive a digital and not hard copy of the MSME registration certificate.

12. If one opts for online Udyam registration, what are the charges to be paid?

Experts of this field generally charge Rs.1999 for their service of online MSME registration.

13. Is it feasible for a MSME registered venture to apply for a loan that is composite?

All banks offer up to Rs.1,00,00,000 as composite loan. Keeping in accordance with RBI guidelines, business ventures can use this money both as a term loan and its working capital also as the case may be.

14. What is the validity of Udyam registration?

Your MSME registration will remain valid throughout the lifespan of your company. But updating your business information from time to time is mandatory.

15. Can rejection of an MSME registration application be possible?

Rejection or approval of an MSME registration solely relies on the information provided by the applicant.

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