The “Scheme for Assistance to Micro, Small and Medium Enterprises (MSME)” is a comprehensive initiative by the Industries and Mines Department, Gujarat, effective from August 7, 2020, to August 6, 2025. The component “Assistance for Interest Subsidy (Service Sector)” supports new MSMEs in the service sector through interest subsidies on term loans for machinery, equipment, and furniture (excluding land/building), fostering competitiveness and employment generation.
Benefits
Financial Assistance (Based on Taluka Category):
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Category I: 8% interest subsidy on term loan, up to ₹35,00,000/- per annum for 7 years
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Category II: 7% subsidy, up to ₹30,00,000/- per annum for 6 years
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Category III & Municipal Corporation Areas: 6% subsidy, up to ₹25,00,000/- per annum for 5 years
Additional Benefit:
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Registered startups receive an extra 1% interest subsidy
Eligibility
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The applicant must be a new Micro/Small/Medium enterprise
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The enterprise must belong to the service sector (as per Annexure A & B)
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The term loan must be sanctioned by a recognized bank or financial institution
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Application must be submitted within one year of loan disbursement or before commercial production
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The enterprise must remain operational for at least 7 years after subsidy approval
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Compliance with pollution control measures is mandatory
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Only one type of investment (expansion/diversification/forward or backward integration) is eligible
Exclusions
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Loans from NBFCs are not eligible for the subsidy
Application Process
Online
Registration Process:
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Visit the Investor Facilitation Portal (IFP) and click on New Investor Registration
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Fill and submit the registration form
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Verify your registered email through the link sent to you
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Registration is completed upon verification
Post-Registration:
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Visit the IFP portal and log in
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Enter your email and password
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Complete the online application by submitting required details and documents
Documents Required
Pre-Sanction Documents:
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Printed application with declaration and undertaking signed by an authorized person
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Udyog Aadhaar / Udyam Registration acknowledgment
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Term loan sanction letter and bank disbursement statement
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Enterprise’s constitution documents (e.g., partnership deed)
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DPR for projects up to ₹5 Cr or bank appraisal for projects above ₹5 Cr
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Shop & Establishment Certificate (for municipal areas)
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GST registration (if applicable), PAN card, ITR of last year
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Self-declaration of machinery value (for new enterprises)
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Proof of age (birth certificate or school leaving certificate) for entrepreneurs below 35
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Caste/disability certificate (if applicable)
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GPCB CTE (if applicable)
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Ownership/lease/rent documents with proof
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Property tax receipt
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Board resolution for signing authority (for firms/LLPs/companies)
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Declaration of other investments
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Balance sheet annexure showing gross fixed investment
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CA certificate for pre-investment capital value
Frequently Asked Questions (FAQs)
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Q: What is the “Scheme for Assistance to MSMEs”?
A: It’s a Gujarat government initiative supporting MSMEs through various incentives including interest subsidy. -
Q: What is the duration of the scheme?
A: From August 7, 2020, to August 6, 2025. -
Q: What is the objective of the interest subsidy component?
A: To reduce financial burden by subsidizing interest on term loans for service sector MSMEs. -
Q: Who is eligible to apply?
A: New MSMEs in the service sector with loans from recognized financial institutions. -
Q: What is the maximum interest subsidy an enterprise can receive?
A: ₹35,00,000 per annum (based on taluka category). -
Q: Can an existing MSME apply?
A: No, only new enterprises are eligible. -
Q: Is GST registration mandatory?
A: Only if applicable to the enterprise. -
Q: Are NBFC loans eligible?
A: No, only loans from recognized banks and financial institutions qualify. -
Q: What if the enterprise shuts down before 7 years?
A: The subsidy benefits may be withdrawn or recovered. -
Q: Can an enterprise claim similar subsidy from the central government?
A: Not if it overlaps; the enterprise must declare other investments/incentives. -
Q: Is Shop & Establishment Registration necessary?
A: Yes, for enterprises in municipal corporation areas. -
Q: Does the subsidy cover penalties or additional bank charges?
A: No, only regular interest on term loans is subsidized. -
Q: Are startups given any additional benefit?
A: Yes, startups get an additional 1% interest subsidy.