The “Financial Assistance To Cottage Industries” is a sub-scheme under the Investment Promotion Scheme (IPS) for Cottage Industries. Initially launched on 3rd July 2015 by the Department of Industries, U.T. Administration of Dadra & Nagar Haveli and Daman & Diu for five years, it has now been extended from 20th May 2022 to 19th May 2027.
Objective
The IPS aims to strengthen and protect MSMEs from market challenges while promoting inclusive growth. Specifically, this sub-scheme provides capital and interest subsidies to support the development of cottage industries, encouraging local employment and women’s entrepreneurship.
Benefits
• Capital Subsidy: 25% of term loan amount for setting up the cottage industry, up to a maximum of ₹5,00,000/-
• Interest Subsidy: 50% reimbursement of interest charged by Bank/NBFC/Cooperative Bank for up to 5 years from production start date
• Additional Capital Subsidy: Extra 10% subsidy for SC/ST/Women/Differently abled (disability ≥30%)
• Maximum Bank Loan Limit: ₹20,00,000/-
Eligibility
• The applicant must be associated with Cottage Industry
• Must be above 18 years of age
• Must have minimum education of Standard IV
• Must fulfill any one of the following:
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Have completed 1-month training at a Govt. of India recognized institute in the relevant field
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Have 1 year experience in the same activity
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Be a hereditary craftsperson
Application Process
Online
Registration Process:
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Visit the Registration page of the Official Website
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Enter all required details and click Register
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Verify your email using the link received (check spam if not found)
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Click the link or paste in browser to verify
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Enter “111111” OTP to verify mobile
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Login credentials will be sent via email
Application Process:
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Login with Mobile Number and PIN
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Go to “Departments & Services”
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Select “District Industries Centre DD & DNH” and click Click Here
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Fill in the Common Application Form (CAF)
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Upload all required documents
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Review and submit your application
Documents Required
• CIN, TIN, PAN, GST documents
• Udyam Registration / IEM
• Partnership Deed / MOA & AOA / Incorporation Certificate
• Land Purchase Deed or Lease Agreement (min. 5 years)
• Sanction Order from Electricity Department + Latest Bill
• Consent to Operate from PCC
• Factory License
• Authorization Letter
• Undertaking
• Any other document as required
Frequently Asked Questions (FAQs)
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What is the definition of Cottage Industry?
A small-scale business run by individuals or families using traditional methods, often home-based. -
What does the scheme provide?
Financial support through capital and interest subsidies for cottage industries. -
What is the maximum limit for the bank loan?
₹20,00,000/- -
What is the rate of capital subsidy?
25% of the term loan amount, up to ₹5,00,000/- -
Is there any additional subsidy for specific groups?
Yes, 10% additional capital subsidy for SC/ST/Women/Differently abled (with ≥30% disability). -
Is there any age limit for the applicant?
Yes, the applicant must be above 18 years of age. -
What measures are in place to prevent misuse of the subsidy scheme?
Verification of documents, inspections, and compliance audits by the Directorate. -
What is the operative period of the scheme?
From 20th May 2022 to 19th May 2027. -
If an enterprise is established in 2023 and becomes eligible for the scheme what would be the time period in which benefits are applicable?
The benefits would apply for 5 years from the date of production commencement or loan sanction, subject to conditions.