Entrepreneurship Development

RMB 402
Dr. Anurag Joshi
Unit 2
DEVELOPMENT BANKS IN INDIA
 DEVELOPMENT BANKS
A Development Bank is a polygonal
development finance institution devoted to
improving the social and monetary
development of its associate nations.
It helps improve the value of people's lives by
providing loans and scientific support for a
broad variety of development activities.
 OBJECTIVES

• Lay Foundations for Industrialization

• Meet Capital Needs

• Need for Promotional Activities

• Help Small and Medium Sectors'

• Increase loans and equity investments to its
developing associate countries (DMCs) for their
monetary and social development.
• Provides technical help for the planning and
implementation of development projects and
programs and for advisory services.
• Promotes and facilitates speculation of public and
private capital for growth and development.
• Responds to requests for assistance in coordinating
growth policies and plans of its increasing member
countries.
 FUNCTIONS
• Financial Gap Fillers
• Undertake Entrepreneurial Role
• Joint Finance
• Refinance Facility
• Credit Guarantee
• Underwriting of Securities
Role of development banks
in financial system
 IFCI
• The government of india set up the industrial finance
corporation of india in july 1948
• Management of IFCI
• 12 directors
• 4 are nominated by the IDBI
 OBJECTIVES OF IFCI
• Promoted by new enterpreneurs
• Based on indegenous technology
• Which would result in substitution of imports
• Providing input for incresing agricultural products
 FUNCTIONS OF IFCI
JOINT FINANCING
 Operational activities
• Concessional finance to projects in less
development areas
• Concessional finance for renewable energy
systems
• Power of attorney scheme
• Bridging loans
• Sub loans in foreign currencies
 IDBI
• The Industrial Development Bank of India (IDBI) was
established on 1 July 1964 under an Act of
Parliament as a wholly owned subsidiary of the
Reserve Bank of India.
• In 16 February 1976, the ownership of IDBI was
transferred to the Government of India and it was
made the principal financial institution for
coordinating the activities of institutions engaged in
financing, promoting and developing industry in the
country.
 The principal source of funds of IDBI
• Share capital and reserves
• Borrowing from government of india and RBI
• Market borrowing by way of bonds
• Deposits and other borrowings
• Repayment of past assitance by borrowers
• Foreign currency borrowings from worid banks
• Asian development banks and international
markets
 Objectives and functions

• Planning, promoting, developing industries

• Co-ordinating the working in institutions
engaged in financing
• Undertaking market and investment research
• Providing technical and administrative
assitance
• Subsidiaries
 Operational Activities
• Direct Assistance
• Indirect Assistance
• Refinance Schemes
• Refinance Scheme for industrial rehabilitation
• Automatic Refinance Scheme
• Refinance Scheme for modernisation
• Bills Rediscounting Scheme Soft loan scheme for
modernization
• Seed capital assistance scheme
• SFCs special share capital schemes
• Development assistance fund(DAF)
 ICICI
• ICICI (INDUSTRIAL CREDIT AND INVESTMENT
CORPORATION OF INDIA) Bank Ltd.
• ICICI is an Indian diversified financial
services company headquartered in Mumbai,
Maharashtra.
• The Bank has a network of 2,630 branches and
8,003 ATM's in India, and has a presence in 19
countries, including India.
 Objectives of ICICI
• Assisting in the creation
• Expansion
• Modernisation of such enterprises
• Encouraging and promoting the participation
private capital
• Encouraging and promoting private ownership
 Functions Of ICICI
• Assistance to industries
• Provision of foreign currency loans
• Merchant banking
• Letter of credit
• Project promotion
• Housing loans
• Leasing operations
 SIDBI
• Established in 1990 under an Act of Indian
Parliament.
• Objective: Promotion, Financing & Development of
MSMEs and Co-ordinating Functions of institutions
engaged in similar activities.
• Ownership : Public sector banks/FIs/Insurance Cos
owned or controlled by the Government of India.
• Structural Linkage: With Ministry of Finance and
Ministry of SSI.
• Nodal Agency : For SME Schemes of GoI
Objectives
 NABARD
•National Bank for Agriculture and Rural
Development (NABARD) is an apex development
bank in India having headquarters based in Mumbai
(Maharashtra)and other branches are all over the
country.
•It was established on 12 July 1982 by a special act by
the parliament
•Main focus was to uplift rural India by increasing the
credit flow for elevation of agriculture & rural non
farm sector and completed its 25 years on 12 July
2007.
 Objectives Of NABARD
1 . To give financial assistance for increasing the
agricultural production
2.To supply the long term needs of the rural
areas
3.To supply loans by way of refinance
4.To help small industries ,cottage industries and
also artisans
5.To achieve overall rural development
 Functions Of NABARD
• Credit functions
• Development functions
• Regulatory functions
• Apex institution for rural finance
• Refinance institutions
• Contribution of share capital
• Investment in securities
• Conversion and rescheduling facilities
• Financial help to non –agricultural sector
• Training programs
• Co-ordination of actvities
 Achievement Of NABARD
• Short term assistance
• long term assistance
• Schematic lending
• Assistance to less developed states
• Assistance to non-farm sector
• Rehabilitation programme
• Assistance to research and development projects
• Credit plans under the new strategy
• Integrated rural development programme
• Regional rural banks
 Entrepreneurial Support Organizations
Central Level Organizations
• NIESBUD-National Institute for Entrepreneurship and
Small Business Development
• SISI-Small Industries Service Institute
• EDII/EDI-Entrepreneurial Development industries of
India
• SIDBI-Small Industries Bank of India
• SIDO- Small Industries Development Organization
• NABARD-National Bank for Agriculture and Rural
Development
• IIE-Indian Institute of Entrepreneurship
• SSIB-Small Scale Industries Board
State Level Organization
• DIC-District Industries Centers
• SFC- State Financial Corporations
• SSIDC-Small Scale Industries Development
Corporations
• SIDC-State Industrial Development Corporations
• TCO- Technical Consultancy Organization
 Role of govt. in promoting
Entrepreneurship
• Financial Assistance-IDBI assists in project finance
schemes that includes loans underwriting, direct
subscriptions and guarantee for setting up new units
as well as expansion diversification and modernization
of existing units.
• Technical Assistance- EDPs, MDPs are conducted by
entrepreneurship development institutes & other
state government agencies like NSIC, IIE, NIESBUD,
NISIET etc. IDBI has offered technical dev. Fund
scheme in 1976 to provide foreign exchange for
import of machinery to speed up technical up
gradation & modernization programmes.
• Promotional Activities- provides developed
infrastructure and sheds on actual cost and
quality up gradation, common facilities and
consultancy services for ED at nominal charges
and an incentive scheme from Govt. of India for
providing reimbursement of charges for
acquiring ISO-9000 certification to the extent of
75% of the cost, subject to a maximum of Rs.
75000 in each case
• SISI arranges exhibition in its office to promotes
products of small entrepreneur free of cost
• Marketing Assistance- For helping abroad
marketing, Govt. has created a marketing
development fund which provides grants, export
promotion schemes with 60% of funding etc. NSIC
makes promotion in domestic and overseas market
and also manages a single point registration
schemes for manufacturers for govt. purchase.
• the units regd. In this scheme get the benefits of
free tender documents and exemption from
earnest money deposit and performance
guarantee.
 District Industries Centers
• DIC were established in May 1978 in order to
cater to the needs of small units.
• 422 DICs have been setup in India by 1991
with assisting more than 1.5 lac units &
employment generating about 11 lac persons

Role of DIC-
• Identification of Entrepreneurs
• Selection of projects
• Provisional registration under SSI
• Purchase of Fixed Assets( it sponsors the loan
application to financial institutions & banks for
purchasing FA and sanction margin money under Rural
Industries Project Scheme)
• Clearances from various departments
• Assistance to raw material suppliers
• Assistance to Village Artisans and Handicrafts
• Interests free Sales Tax Loans
• Subsidy Schemes
• Training Programmes
 Small Industries Service Institute
• SISI is a national level organization established By
Central govt.
• At the state level, it functions under the Director
assisted by Deputy Directors.
• There are 28 SISIs and 30 branch of SISIs setup in
state capitals and other industrial cities all over the
country.
Role of SISI
• Technical Information ( info. About availability and
supply of raw material, machine & equipments for
production, Q.C. standardization, modernization etc.)
• Workshops
• Technical training
• Economic Investigation Division
• Export Promotion
• Modernization
• Development of the Market
• Library
• Exhibitions
Entrepreneurial Development Institute of India
• EDII is an institutional setup by public financial
institutions, govt. of Gujarat and Govt. of India which
was established in 1983 at Ahmadabad.

• EDII is an autonomous body and non-profit organization

sponsored by apex financial institutions like IDBI, IFCI
Ltd., ICICI Ltd., SBI etc.
• Institute is registered under Societies Registration Act
1860 & Public Trust Act 1950

• EDII has been selected as a member of Economic &

Social Commission for Asia and the Pacific (ESCAP)- a
centre of excellence for HRD Research & Training.
• EDII is principle agency for creating entrepreneurship
development by conducting EDP & innovative training
techniques. EDP comprises following steps.
1. Selecting potential entrepreneurs
2. Achievement motivation training
3. Product selection & project report preparation
4. Business management training
5. Practical training & work experience
6. Post training & follow-up
7. Model training program
 Role / Functions of EDII
• Develops program for entrepreneurial training &
development
• Develops innovative training techniques for trainers
• Creating multiplier effect on opportunities for Self-
Employment
• Focused attention on Women entrepreneurs with first such
EDP in 1988
• EDP for rural EDP in U.P. and ORISSA.
• Promoting Micro enterprises at rural levels
• Improving managerial capabilities of Small Scale Industry
• Famous for organizing Camps on Entrepreneurship
• Conducted EDP in Sri Lanka, Nepal, Ghana, Kenya etc.
 National Institute of Entrepreneurship &
Small Business Development
• It was established in 1983 by Ministry of Small Scale
Industry, Govt. of India.
• NIESBUD is registered as a society under Govt. of
India Society Act (XXI of 1860)started functioning
from 6 July 1983.
• The governing council consists secretary as its
Chairman (minister of SSI) and Executive Director as
its member secretary that are apex body of institute
that direct and guide the policy and decisions.
 Objectives of NIESBUD
• To serve as apex body for accelerating the process of
entrepreneurship development and ensuring its impact across
the country
• To provide vital information and support to trainers, promoters
and entrepreneurs by research & documentation relevant to ED
• To help/support and affiliate organizations in carrying out
training & other ED related activities
• To develop standardized material & processes for selection,
training, support of entrepreneurs.
• To train trainers, promoters, consultants, entrepreneurs in
various areas of ED
• To share experience & expertise in ED across National frontiers
 Role of NIESBUD
• Assisting/Supporting EDPs that includes formulation of
standardized procedures of identification & selection of
potential entrepreneurs, preparation of training Aids
Materials etc.
• Training of trainers/promoters
• Evolving Standardized materials& Research
Publications
• Creation & Capacity building EDP institution that
includes assistance covers developing faculty, providing
training and library facilities along with sharing
experiences of conducting program at the initial stage.
• Small Business in focus
• National /International Forum for exchange of
ideas and experiences
• Developing Entrepreneurial Culture by using
mass media, TV and AIR etc.
• Services to Affiliated Members
• Sustaining Entrepreneurship by providing
education, counseling and consultancy and short
duration program on WCM, Marketing, Project
Identification, accounting etc. for SSI
entrepreneurs
 Small Industries Development Bank of India
(SIDBI)
• It was established in 1990 exclusively for SSI
• It is a Central govt. undertaking with aims to
promote and develop SSI by providing them a
valuable factor of production finance (long & short
terms) etc.
• It provides loan assistance to the institutions by
creating market or marketing avenues, ancillary units
and for modernization & upgrading technology, in
developing primary infrastructure and growth
centers etc.
 Objectives & Functions of SIDBI
• To initiate steps for technological up gradation
and modernizations of existing units
• To expand marketing channels of SSI sectors
products in India and abroad
• To promote employment oriented industries
in semi-urban, rural areas and to check
migration of population to big cities
• Administration of SIDF/NEF for development &
support of small and tiny-industries (small industries dev.
Fund)
• Providing WCM through single window scheme
• Providing re-finance support to bank/ financial
institutions ( for modernization projects up-to 50
lacs)
• Undertaking direct financing of SSI units
• Coordination of functions of various institutions
engaged in finance to SSI and Tiny units.
• SIDBI will participate in venture capital fund set up
by PSUs as well as private companies up to 50 %
of the total corpus of funds for financing SSI
 National Bank for Agriculture & Rural
Development (NABARD)
• It was established on July 12, 1982 by Govt. of
India for promoting integrated rural
development & to provide all sorts of
production and investment credit for
agriculture & rural development.
Constitution/Structure of NABARD- It is managed by
BOD, consisting of Chairman, M.D.
and 13 Directors.
• 2 directors from amongst experts in rural economics
and rural development etc.
• 3 directors from out of the working of Co-operative
Banks.
• 3 directors from the out of directors of RBI
• 3 directors from amongst the officials of Govt. of
India
• 2 directors from amongst the officials of State govt.
Objectives of NABARD-
• To give undivided attention and purposeful
direction to integrated rural development.
• To act as a creative piece for the entire rural
credit system at the National level.
• To act as a provider of supplemental funding
to rural credit institutions
• To arrange for investment credit to small
industries, village & cotton industries,
handicrafts, rural crafts and farmers.
• To improve the credit distribution system by
institution building, rehabilitation and training of bank
personnel.
• To provide refinance facilities to RRB, SCB and
commercial banks for developmental purpose in rural
areas.
• To coordinate the working of different agencies
engaged in rural development at regional level and to
have liaison with govt. of India, RBI, state Govt. and
policy making institutions at the national level
• To inspect, monitor and evaluate projects getting
reference from NABARD.
Functions of NABARD-
• Credit distribution
1. Short term credit
2. Medium term credit
3. Long term credit
4. Facilities for Changes and Rearrangements
5. Refinancing of Industries in Rural Areas
• Developmental Functions
• Regulatory Functions
 Government of India Support for Innovation and
Entrepreneurship in India
• The Government of India has undertaken several initiatives and instituted policy
measures to foster a culture of innovation and entrepreneurship in the country. Job
creation is a foremost challenge facing India. With a significant and unique
demographic advantage, India, however, has immense potential to innovate, raise
entrepreneurs and create jobs for the benefit of the nation and the world.
• In the recent years, a wide spectrum of new programmes and opportunities to
nurture innovation have been created by the Government of India across a number
of sectors. From engaging with academia, industry, investors, small and big
entrepreneurs, non-governmental organizations to the most underserved sections of
society.
• Recognising the importance of women entrepreneurship and economic participation
in enabling the country’s growth and prosperity, Government of India has ensured
that all policy initiatives are geared towards enabling equal opportunity for women.
The government seeks to bring women to the forefront of India’s entrepreneurial
ecosystem by providing access to loans, networks, markets and trainings.
• Start Up India
• Make in India
• Atal Innovation Mission (AIM)
• Support to Training and Employment Programme for Women
(STEP)
• Jan Dhan- Aadhaar- Mobile (JAM)
• Digital India
• Biotechnology Industry Research Assistance Council (BIRAC)
• Department of Science and Technology (DST)
• Stand-Up India
• Trade related Entrepreneurship Assistance and Development
(TREAD
• Pradhan Mantri Kaushal Vikas Yojana (PMKVY)
• National Skill Development Mission
• Science for Equity Empowerment and Development (SEED)
 Startup India
Through the Startup India initiative, Government of India
promotes entrepreneurship by mentoring, nurturing and
facilitating startups throughout their life cycle. Since its
launch in January 2016, the initiative has successfully
given a head start to numerous aspiring entrepreneurs.
With a 360 degree approach to enable startups, the
initiative provides a comprehensive four-week free
online learning program, has set up research parks,
incubators and startup centres across the country by
creating a strong network of academia and industry
bodies.
 Make in India
• Designed to transform India into a global design and
manufacturing hub, the Make in India initiative was launched
in September 2014. It came as a powerful call to India’s
citizens and business leaders, and an invitation to potential
partners and investors around the world to overhaul out-
dated processes and policies, and centralize information
about opportunities in India’s manufacturing sector.
• This has led to renewed confidence in India’s capabilities
among potential partners abroad, business community
within the country and citizens at large..
 Atal Innovation Mission (AIM)
• AIM is the Government of India’s endeavour to promote a culture of
innovation and entrepreneurship, and it serves as a platform for
promotion of world-class Innovation Hubs, Grand Challenges, start-
up businesses and other self-employment activities, particularly in
technology driven areas. In order to foster curiosity, creativity and
imagination right at the school, AIM recently launched Atal Tinkering
Labs (ATL) across India.
• ATLs are workspaces where students can work with tools and
equipment to gain hands-on training in the concepts of STEM
(Science, Technology, Engineering and Math). Atal Incubation
Centres (AICs) are another programme of AIM created to build
innovative start-up businesses as scalable and sustainable
enterprises
 Support to Training and Employment
Programme for Women (STEP)
• STEP was launched by the Government of India’s Ministry of
Women and Child Development to train women with no
access to formal skill training facilities, especially in rural India.
• The Ministry of Skill Development & Entrepreneurship and
NITI Aayog recently redrafted the Guidelines of the 30-year-old
initiative to adapt to present-day needs. The initiative reaches
out to all Indian women above 16 years of age. The
programme imparts skills in several sectors such as agriculture,
horticulture, food processing, handlooms, traditional crafts like
embroidery, travel and tourism, hospitality, computer and IT
services.
Jan Dhan- Aadhaar- Mobile (JAM)
• JAM, for the first time, is a technological
intervention that enables direct transfer of
subsidies to intended beneficiaries and, therefore,
eliminates all intermediaries and leakages in the
system, which has a protential impact on the lives
of millions of Indian citizens. Besides serving as a
vital check on corruption, JAM provides for
accounts to all underserved regions, in order to
make banking services accessible down to the last
mile.
 Digital India
• The Digital India initiative was launched to modernize the
Indian economy to makes all government services available
electronically.
• The initiative aims to transform India into a digitally-
empowered society and knowledge economy with universal
access to goods and services.
• This program aims to improve citizen participation in the
digital and financial space, make India’s cyberspace safer and
more secure and improve ease of doing business.
• Digital India hopes to achieve equity and efficiency in a
country with immense diversity by making digital resources
and services available in all Indian languages.
 Department of Science and Technology
(DST)
• The DST comprises several arms that work across the spectrum on all
major projects that require scientific and technological intervention.
• The Technology Interventions for Disabled and Elderly, for instance,
provides technological solutions to address challenges and improve
quality of life of the elderly in India through the application of science
and technology. On the other hand, the ASEAN-India Science,
Technology and Innovation Cooperation works to narrow the
development gap and enhance connectivity between the ASEAN
countries.
• It encourages cooperation in science, technology and innovation
through joint research across sectors and provides fellowships to
scientists and researchers from ASEAN member states with Indian
R&D/ academic institutions to upgrade their research skills and
expertise.
 Stand-Up India
• Launched in 2015, Stand-Up India seeks to leverage
institutional credit for the benefit of India’s underprivileged.
• It aims to enable economic participation of, and share the
benefits of India’s growth, among women entrepreneurs,
Scheduled Castes and Scheduled Tribes. Towards this end, at
least one women and one individual from the SC or ST
communities are granted loans between Rs.1 million to
Rs.10 million to set up greenfield enterprises in
manufacturing, services or the trading sector.
• The Stand-Up India portal also acts as a digital platform for
small entrepreneurs and provides information on financing
and credit guarantee
 Pradhan Mantri Kaushal Vikas Yojana
(PMKVY)
• A flagship initiative of the Ministry of Skill
Development & Entrepreneurship (MSDE), this is a
Skill Certification initiative that aims to train youth in
industry-relevant skills to enhance opportunities for
livelihood creation and employability.
• Individuals with prior learning experience or skills
are also assessed and certified as a Recognition of
Prior Learning. Training and Assessment fees are
entirely borne by the Government under this
program.
 National Skill Development Mission
• Launched in July 2015, the mission aims to build synergies
across sectors and States in skilled industries and
initiatives.
• With a vision to build a ‘Skilled India’ it is designed to
expedite decision-making across sectors to provide skills
at scale, without compromising on quality or speed. The
seven sub-missions proposed in the initial phase to guide
the mission’s skilling efforts across India are:
• (i) Institutional Training (ii) Infrastructure (iii) Convergence
(iv) Trainers (v) Overseas Employment (vi) Sustainable
Livelihoods (vii) Leveraging Public Infrastructure.
 Science for Equity Empowerment and
Development (SEED)
• SEED aims to provide opportunities to motivated scientists
and field level workers to undertake action-oriented,
location specific projects for socio-economic gain,
particularly in rural areas.
• Efforts have been made to associate national labs and
other specialist S&T institutions with innovations at the
grassroots to enable access to inputs from experts, quality
infrastructure.
• SEED emphasizes equity in development, so that the
benefits of technological accrue to a vast section of the
population, particularly the disadvantaged.
Role of Government in Promoting Entrepreneurial
Development specially in terms of MSME

• Scheme for providing establishment of new

institutions (EDIs)
• Strengthening the Infrastructure for EDIs
under ATI scheme
• Assistance to Training Institutions scheme
• Marketing Assistance Scheme
• Credit Guarantee Scheme
• Credit Linked Capital Subsidy Scheme for Technology Up-
gradation
• ISO 9000/ISO 14001 Certification Reimbursement Scheme
• Micro & Small Enterprises Cluster Development
Programme (MSE-CDP)
• Micro Finance Programme
• MSME Market Development Assistance (MDA)
• Support or Entrepreneurial and Managerial Development
of SMEs
• Marketing Assistance & Technology Up-gradation Scheme
• Participation of MSMEs in State/District level trade fair
 Assistance to Training Institutions scheme
Description The assistance shall be provided to training institutions in the form of
capital grant for creation/strengthening of infrastructure and programme
support for conducting entrepreneurship development and skill development
programmes.
Nature of assistance
• Maximum assistance for creation or strengthening of infrastructure will be
Rs.150 lakhs on matching basis, not exceeding 50% of project cost. However, for
the North Eastern region (including Sikkim), Andaman & Nicobar and
Lakshadweep, maximum
• assistanceon matching basis would be Rs.270 lakhs or 90% of project cost,
whichever is less. Maximum assistance per trainee per hour for
entrepreneurship development and skill development programmes is Rs.50
(Rs.60 for NER, A&N and Lakshadweep)
Who can apply?
• Any State/Union Territory Government, Training Institutions, NGOs and other
development agencies can apply for assistance for creation or strengthening of
infrastructure. Training institutions who wish to conduct training programmes
• under the scheme will have to enroll themselves with any of the three national
• level EDIs of the Ministry viz, NIESBUD, Noida; IIE Guwahati and nimsme,
Hyderabad.
 Marketing Assistance Scheme
Description
• The assistance is provided for following activities:
• Organizing exhibitions abroad and participation in
International exhibitions/trade fairs
• Co-sponsoring of exhibitions organized by other
organizations/industry associations/agencies
• Organizing buyer-seller meets, intensive campaigns and
marketing promotion events
Nature of assistance Financial assistance of up to 95% of the
airfare and space rent of entrepreneurs. Assistance is
provided on the basis of size and type of the enterprise.
Financial assistance for co-sponsoring would be limited to
40% of the net expenditure, subject to a maximum amount of
Rs.5 lakh
Who can apply? MSMEs, Industry Associations and other
organisations related to the MSME Sector
 Credit Guarantee Scheme
Description-Ministry of Micro, Small and Medium Enterprises, GoI and
Small
• Industries Development Bank of India (SIDBI), established a Trust
named Credit Guarantee Fund Trust for Micro and Small Enterprises
(CGTMSE) to implement Credit Guarantee Fund Scheme for Micro
and Small Enterprises. The corpus of CGTMSE is being contributed
by GoI and SIDBI.
Nature of assistance
• For individuals: Collateral free loans upto a limit of Rs.50 lakhs -for
individual MSEs.
Who can apply?
• Both existing and new enterprises are eligible to be covered under
the scheme.
 Credit Linked Capital Subsidy Scheme for
Technology Upgradation
Description-Technology up-gradation would ordinarily mean induction of state-of-
the-art or near state-of-the-art technology. In varying mosaic of technology
obtaining in more than 7,500 products in Indian small scale sector, technology up-
gradation would mean a significant step up from present technology level to a
substantially higher one involving improved productivity, and/or improvement in
quality of products and/or improved environmental conditions including work
environment for the unit.
• It include installation of improved packaging techniques as well as anti-pollution
measures and energy conservation machinery. Further, units in need of introducing
facilities for in-house testing and on-line quality control would qualify for
assistance, as the same is a case of technology up-gradation.
• Replacement of existing equipment/technology with same equipment/technology
will not qualify for subsidy under this scheme, nor would scheme be applicable to
units upgrading with second hand machinery.
Nature of assistance
• The revised scheme aims at facilitating technology up-gradation by providing
15% up-front capital subsidy to SSI units, including tiny, khadi, village and coir
industrial units, on institutional finance availed of by them for induction of well
established and improved technologies in specified sub-sectors/products
approved under the scheme.
Revised CLCSS has been amended as follows:
• (a) Ceiling on loans under scheme has been raised from Rs.40 lakh to Rs.1 crore
• (b) Rate of subsidy has been enhanced from 12% to 15%
• (c) Admissible capital subsidy is calculated with reference to purchase price of
plant and machinery, instead of term loan disbursed to beneficiary unit
• (d) Practice of categorisation ofSSI units in different slabs on the basis of their
present investment for determining eligible subsidy has been done away with;
and
• (e) Operation of scheme has been extended upto 31 st March, 2007.
• The above revisions/amendments are effective from September 29, 2005.
Who can apply?
• Eligible beneficiaries include sole proprietorships, partnerships, co-operative
societies, and private and public limited companies in the SSI sector. Priority
shall be given to women entrepreneurs.
 ISO 9000/ISO 14001 Certification
Reimbursement Scheme
Description- Small scale sector has emerged as dynamic and
vibrant and making significant contribution to industrial
production, export and employment generation.
• The process of economic liberalization and market reforms
has opened up Indian small scale sector to global competition.
• In order to enhance the competitive strength of small scale
sector, Government introduced an incentive scheme for their
technological up-gradation/quality improvement and
environment management. The scheme provides incentive to
those small scale/ancillary undertaking who have acquired
ISO 9000/ISO 14001/HACCP certifications.
• The scheme enlarged so as to include reimbursement of
expenses for acquiring ISO 14001 certification
Nature of assistance
• Scheme envisages reimbursement of charges of
acquiring ISO9000/ISO14001/HACCP certifications
to the extent of 75% of expenditure subject to a
maximum of Rs.75,000 in each case.
Who can apply?
• Permanent Registered Micro Small Enterprises
(MSEs) units are eligible to avail incentive scheme.
• Scheme is applicable to those
MSEs/ancillary/tiny/SSSBE units who have already
acquired ISO-9000/ISO-14001/HACCP certification.
 Micro & Small Enterprises Cluster
Development Programme (MSE-CDP)
Description
• Ministry of Micro, Small and Medium Enterprises (MSME),
Government of India (GoI) has adopted cluster development
approach as a key strategy for enhancing productivity and
competitiveness as well as capacity building of Micro and
Small Enterprises (MSEs) and their collectives in the country.
• Clustering of units also enables providers of various services
to them, including banks and credit agencies, to provide
their services more economically, thus reducing costs and
improving availability of services for these enterprises.
Objectives of the scheme:
• i. Support sustainability and growth of MSEs by addressing
common issues such as improvement of technology, skills
and quality, market access, access to capital, etc.
• ii. Build capacity of MSEs for common supportive action
through formation of self help groups, consortia, up
gradation of associations, etc.
• iii .To create/upgrade infrastructural facilities in the
new/existing industrial areas/clusters of MSEs.
• iv. To set up common facility centers (for testing, training
centre, raw material depot, effluent treatment,
complementing production processes, etc)
Nature of assistance
• Diagnostic study
• Soft intervention
• Setting up of Common Facility Centres( CFCs)
• Infrastructure development (Up-gradation/New
• Cost of project and Govt of India assistance:
• Diagnostic study -Maximum cost Rs.2.50 lakhs.
• Soft interventions -Maximum cost of project Rs.25.00 lakh, with GoI
contribution of 75% (90% for special category States and for clusters with more
than 50% women/micro/village/SC/ST units).
• Hard interventions i.e.,setting up of CFCs –maximum eligible project cost of
Rs.15.00 crore with GoI contribution of 70% (90% for special category States
and for clusters with more than 50% women/micro/village/SC/ST units).
• Infrastructure development in the new/existing industrial estates/areas.
Maximum eligible project cost Rs.10.00 crore, with GoI contribution of 60%
(80% for special category States and for clusters with more than 50%
women/micro/SC/ST units).
Who can apply?
• Industrial association/Consortium, Clusters
 Micro Finance Programme
Description
• Government launched a Scheme of Micro Finance Programme and tied
up with existing programme of SIDBI by way of contributing towards
security deposits required from the MFIs/NGOs to get loan from SIDBI.
The scheme is being operated in under served States and under served
pockets/districts of other States
Nature of assistance
• Government of India provide funds for Micro Finance Programme to
SIDBI, which is called ‘Portfolio Risk Fund’ (PRF). At present SIDBI takes
fixed deposit equal to 10% of loan amount. The share of MFIs/NGOs is
2.5% of loan amount (i.e.,25% of security deposit) and balance 7.5%
(i.e.,75% of security deposit) is adjusted from funds provided by the
Government of India.
Who can apply?
• MFIs/NGO
How to apply?
• Submit the proposal in prescribed form to SIDBI
 MSME Market Development Assitance
(MDA)
• Description As part of comprehensive policy package for MSMEs,
MSME-MDA scheme has been announced with a view to increase
participation of representatives of participating units, the provision of
MSME-MDA scheme has been modified recently. MDA is offered in
three forms as mentioned below:
• Participation in the international exhibitions/fairs-For registered small &
micro manufacturing enterprises with DI/DIC. Financial assistance for
using Global Standards (GS1) in bar coding-Recognised importance of
bar coding and avail financial assistance through Office of DC(MSME).
• Purchase and Price Preference Policy-This is administered through
Single Point Registration Scheme of NSIC. Under this, 358 items are
reserved for exclusive purchase from MSME by Central Government.
Other facilities include tender documents free of cost, exemption from
earnest money and security deposit and 15% price preference in
Central Government purchases -for individual MSMEs.
Nature of assistance
• The scheme offers funding upto 75% in respect of to and fro air fare
• for participation by MSME entrepreneurs in overseas fairs/trade
• delegations. The scheme also provide for funding for producing
publicity material (upto 25% of costs). Sector specific studies (upto
Rs.2 lakhs) and for contesting anti-dumping cases (50% upto Rs.1
lakh) -for individual MSMEs & associations.
Who can apply?
• Individual MSMEs & industry associations.
How to apply?
• Candidates meeting eligibility criteria may send their application to
office of DC (MSME) through concerned MSME-DIs
 Support or Entrepreneurial and Managerial
Development of SMEs
Description
• The objective of the scheme is to provide early stage funding for nurturing
innovative business ideas (new indigenous technology, processes, products,
procedure,etc.) which could be commercialized in a year. Under this scheme
financial assistance is provided for setting up of business incubators.
Nature of assistance
• Funding support for setting up of ‘Business Incubators (BI)’. The cost may
vary between Rs.4-8 lakh for each in cubatee/idea, subject to overall ceiling
of Rs. 62.5 lakh for each BI. Items @ per BI12
• (a) Up gradation of infrastructure Rs. 2.50 lakhs
• (b) Orientation/Training Rs. 1.28 lakhs
• (c) Administrative expenses Rs. 0.22 lakhThus the total assistance per BI -Rs.
66.50 lakhs
Who can apply?
• Any individual or MSME having innovative idea near
commercialization can apply to the host institution
(e.g.,IITs, NITs, Technical Colleges, Research
institutes,etc.).See list of host institutions at
http://www.dcmsme.gov.in/schemes/Institutions_Det
ail.pdf

• Any technical institution (as given in EOI) which

wants to become host institution can apply to office
of Development Commissioner–MSME (DC-MSME)
or their nearest MSME-DIs for funding support.
 Marketing Assistance & Technology Up-
gradation Scheme
Description
• Marketing Assistance and Technology Up gradation scheme is a GoI
initiative for adoption of modern marketing techniques by MSMEs
consistent with the requirement of global market. The scheme is divided
into eight subcomponents and GoI assistance is available in various
proportions.
Nature of assistance
• Funding support for conducting awareness on new packaging technologies
(applicant as mentioned in EOI)
• Cluster based studies on packaging status and need for up-gradation (gap
analysis)(applicant as mentioned in EOI)
• Unit based intervention for packaging requirement (pilot). (applicant as
mentioned in EOI)
• Funding support for conducting skill up-gradation/
Development programmes for modern marketing
techniques. (applicant as mentioned in EOI)
• Funding support for conducting trade competition
studies.(applicant as mentioned in EOI)
• Funding support to MSMEs belonging to North-
Eastern Region for participation in marketing
events. (For North East–Region MSMEs)Enabling
participation of MSMEs in State/District level local
Exhibitions/Trade fairs and provide funding
support (reimbursement)(Registered MSMEs)
• Funding support (in the form of reimbursement) to MSMEs for
adopting Corporate Governance Practices. (Registered MSMEs)
• Funding support for setting up of marketing hubs
• Reimbursement to ISO 18000/ISO 22000/ISO 27000 certification
for MSMEs.
• GoI assistance of Rs.0.50 lakh per programme (GoI:unit :: 80:20)
-per awareness programme
• GoI assistance of Rs.10 lakh (GoI:unit::80:20)-for cluster based
study on packaging.
• GoI assistance of Rs.9 lakh (GoI:unit::80:20) for a group of 10
units towards unit based interventions for packaging
requirements in clusters
• GoI assistance of Rs.6 lakh (GoI: unit::80:20) per cluster for skill
up-gradation programmes
• GoI assistance of Rs.8 lakh (GoI:unit::80:20) per trade competition
study
• Reimbursement up to Rs.75,000 per unit(north–east ) for space
charge, to and fro and transport charges
• The total reimbursement upto Rs.30,000 per unit for
SC/ST/Women/Physically Handicapped entrepreneurs, and
Rs.20,000 per person for other MSME units for 18 participation in
state and district level trade fairs.
• Reimbursement up to 50% of total expenditure subject to
maximumRs.45,000 per MSME unit for adopting corporate
government practices
• Funding support of Rs.30 lakhs (GoI) for marketing hubs, plus Rs.5
lakhs (GoI) for furniture, IT,etc.,and recurring expensesof Rs.15
lakhs (80% GoI, 20% private units) for 2 years
• One time reimbursement of expenditure to the extent of 75%
subject to a maximum of Rs.1 lakh in each case for acquiring ISO
Who can apply?
• Competent agency as mentioned in the EOI guidelines, MSMEs,
industry associations, NGOs.
 Participation of MSMEs in State/District
level trade fair
• SSC supported by office of DC (MSME) will identify and approve manufacturing
MSME clusters/units for participating
• in State/ District level local Exhibitions/Trade Fairs on the basis of responses
received through MSME-DIs, Industries Associations, and NGOs Applicant MSME
unit will submit its claim along with required documents to local MSME-DI office
for reimbursement in prescribed format
For adopting Corporate Governance Practices.
• Office of DC-MSME will identify MSME units for participating in this activity on the
basis of request received through MSME-DIs, Industries Associations and NGOs
• The applicant MSME unit will submit claim along with required documents to the
local MSME-DI office for reimbursement in prescribed format
For Reimbursement of Certification
• The application form is given along with the scheme guidelines,
(http://www.dcmsme.gov.in/schemes/MarkAssis.pdf) fill application form and
send it to Regional MSME-DI along with supporting documents