The Ultimate Guide to MSME Schemes, Loans & Grants

If you run a small business in India, whether it’s manufacturing garments, operating a small hotel, or trading electrical goods, you’re part of the vast MSME sector (Micro, Small & Medium Enterprises).

And guess what? 

The Indian government wants businesses like yours to grow. That’s why they’ve rolled out dozens of MSME schemes, grants, and funding options to make it easier for you to get capital, upgrade technology, expand, or even train your team.

Yet most MSME owners either don’t know these MSME schemes exist, or they’re too confused by paperwork and jargon to take advantage.

In this guide, I’ll break down…

• The top MSME grants, non-refundable funds, and loans 
• Popular MSME government schemes & Yojanas
• How to check your MSME loan eligibility
• The step-by-step way to register and apply, so you don’t miss out on these benefits.

Why MSME Schemes Matter?

While running a business, cash flow gets tight, new machines are costly, hiring is tough… yet you’re still expected to compete, grow, and pay taxes.

That’s why the Indian government has put in place dozens of MSME schemes, including non-refundable grants for MSMEs, collateral-free loans, interest subsidies, and special provisions for small businesses under MSME registration benefits.

Why is this important for you?

1. Easier to get loans

With schemes like CGTMSE, even if you don’t have collateral, banks are encouraged to lend to you.

2. Cheaper capital

MSME yojanas often come with lower interest rates or partial interest subsidies.

3. Get non-refundable grants

Some government schemes offer outright grants to buy equipment or upgrade tech.

4. Grow with confidence

Helps you plan long-term business development without worrying about every rupee.

These MSME government schemes exist so businesses like yours can create jobs, boost the local economy, and make India’s small businesses globally competitive.

So why not use them?

Government schemes give you a foundation, but real business growth comes from what you do next.
This 3-day program shows you how to implement proven strategies and scale your MSME with clarity.

Top MSME Grants & Non‑Refundable Funds

Many business owners think government help only comes as loans you have to pay back. 

But under several MSME schemes, there are also non-refundable grants, money given to help you grow, upgrade, or innovate that you DON’T have to repay.

Examples of key MSME grants & schemes

1. MSME Technology Upgradation (CLCSS)

Get a 15% capital subsidy (up to ₹15 lakhs) to upgrade to modern machines. This is ideal for small units purchasing new CNCs or garment embroidery equipment.

2. SFURTI (Scheme of Fund for Regeneration of Traditional Industries)

Grants to help clusters in handlooms, handicrafts, coir & agro industries set up common facilities, design centres, and marketing hubs.

3. ZED Certification Scheme 

Under MSME sustainability, the government offers up to ₹3 lakh grant for getting ZED certification, which improves quality and makes exports easier.

4. PMEGP (Prime Minister’s Employment Generation Programme)

Not exactly a pure grant, but it offers 35% margin money subsidy (meaning a part of your project cost is funded by the government, which you never repay).

5. Support for Incubators & Startups under MSME Development

Grants up to ₹15 lakh per idea for product development & design.

A quick tip for you!

Even if you’re a small workshop or service provider, you can apply.

Ensure your business is registered correctly in the Udyam/MSME registration, as most grants and schemes require this.

MSME Loans & Udyog Aadhaar Funding

What exactly is it?

The government and banks offer various MSME loans designed to give you easier and faster access to funds. 

These are not grants. You do repay them, but they often come with lower interest, flexible terms, and sometimes collateral-free approval under government guarantees.

If your business is registered under Udyam (formerly known as Udyog Aadhaar), you become eligible for many of these special funding programs.

Popular MSME loan schemes

1. CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises)

• Offers collateral-free loans up to ₹2 crore.
• Instead of you putting up property, the government guarantees a large part of the loan.
• Available via almost all major banks.
  

2. Stand Up India & MUDRA Loans

• MUDRA loans under Pradhan Mantri Mudra Yojana (PMMY) give up to ₹10 lakh for micro & small businesses (like shops, small manufacturers, traders).
• Stand Up India targets loans from ₹10 lakh to ₹1 crore, mainly for SC/ST & women entrepreneurs.
  

3. MSME Business Loans in 59 Minutes

• A digital initiative to approve term loans or working capital up to ₹5 crore in principle within an hour.
• Actual disbursement depends on your financials & bank checks.
  

4. SIDBI & other specialised schemes 

SIDBI (Small Industries Development Bank of India) offers direct & refinance loans for machinery, tech upgradation, and export promotion.

Important: MSME loan eligibility & caution

• You must generally have your business registered under MSME (Udyam) with a valid certificate, plus GST, ITR, and bank statements.
  
• Approvals depend on your credit history, turnover, existing liabilities, and detailed project reports.
  
• Always read terms carefully: interest rates, repayment tenure, and hidden charges differ by bank.
  

Disclaimer!!! This is purely for information. Banks and government agencies are the sole determinants of actual eligibility, loan approval, and terms. Always consult your banker or financial advisor.

Government‑Backed MSME Schemes

Apart from loans and grants, the government also runs several schemes to solve problems like delayed payments, lack of skilled workers, or even finding buyers.

Here are some top MSME government schemes you should know about…

1. MSME Samadhan 

Helps you get payments stuck with buyers.

• If a large company delays payment beyond 45 days, you can file a claim on this portal.
  
• It’s monitored by the Ministry, increasing pressure to clear your dues.
  

2. MSME Sampark 

A digital job portal that connects MSME employers with skilled youth, helping you hire trained staff without hefty agency fees.

3. CHAMPIONS Portal 

A single-window platform for resolving MSME grievances, tracking applications for various schemes, or even getting guidance on exports and certifications.

4. Udyam Registration Benefits 

Registering under Udyam (MSME) not only makes you eligible for most loans & grants, but it also gives you:

• Easier access to government tenders (with EMD waivers in many cases).
  
• Priority sector lending benefits from banks.
  
• Protection under delayed payments provisions.
  

Keep your MSME Udyam certificate, GST, ITRs, and basic project documents ready. Most schemes (whether it’s for funding, training, or market support) start by asking for these.

MSME Loan Eligibility & Registration Benefits

Who is eligible for MSME loans & schemes?

Most MSME schemes, whether it’s a non-refundable grant, collateral-free loan under CGTMSE, or a special MSME yojana, start by checking:

1. MSME (Udyam) Registration Certificate 

Your official proof that you’re in the MSME sector.

2. Business turnover & investment 

Must fit MSME limits (for example, micro businesses under ₹1 crore investment & ₹5 crore turnover).

3. Basic financial discipline

Last 1–2 years’ ITRs, GST filings, and a clean repayment history improve chances.

4. Bank statements & credit track record 

Shows you manage money well. A requirement for both banks and the subsidy schemes.

What benefits do you get after MSME registration?

Being officially registered under the MSME sector unlocks…

1. Access to MSME schemes & loans 

Most grants, subsidies, and collateral-free loans need your Udyam details.

2. Faster loan processing 

Banks treat MSMEs as priority sector, with quicker approval and better terms.

3. Protection under the delayed payment law 

Buyers who delay payments beyond 45 days face extra interest & your complaints go straight to MSME Samadhan.

4. Concessions in government tenders

Many state & central projects waive EMD fees or give tender preference to registered MSMEs.

Don’t skip registration thinking it’s “for bigger businesses.” Even the smallest workshop or trader qualifies, and this simple step unlocks major MSME benefits.

How to Apply – Step‑by‑Step Guide for MSME Business Owners

Applying for MSME schemes, grants, or loans doesn’t have to be overwhelming. Here’s a simple step-by-step guide that covers registration, application, and follow-up.

1. Get your MSME (Udyam) Registration

• Register on the official portal: udyam registration
• It’s free, completely online and linked to your Aadhaar & PAN.
  
• Once done, you’ll get a Udyam Certificate with a unique number, your golden ticket for all MSME government schemes.
  

2. Gather your basic business documents

Before you apply anywhere (bank, subsidy portal, scheme website), keep ready…

• Udyam Registration Certificate 
• Last 1-2 years ITRs & GST returns
• Bank statements (6-12 months)
• Business address proof & basic project report (for loans or grants)

3. Check which scheme fits your needs

• Want a loan with no collateral? Look at CGTMSE, MUDRA, Stand Up India.
• Need a non-refundable grant for MSME tech upgrade? Try CLCSS or ZED.
  
• Have unpaid invoices from large buyers? File on MSME Samadhan.
  

4. Apply via the right channel

• Bank loans

Approach your bank branch or use portals like PSBLoansIn59Minutes.com.

• Subsidies/grants

Most apply through state MSME DICs (District Industries Centres) or scheme-specific portals.

• Skill, export or quality schemes

Often directly via MSME ministry sites.

5. Follow up & track application

• Keep a physical folder + digital copies of every form submitted.
• Regularly track your application on the bank or government portals.
  
• Respond quickly if they ask for more docs.

Expect some paperwork and delays, but with your Udyam certificate + clean documents, you’re already way ahead.

Final Thoughts!

If you’ve read this far, you’re already ahead of countless others who stay stuck because they never explore these options.

Your business deserves every bit of support that’s out there. So take that first step… get your Udyam registration, organise your documents, and apply for the schemes that fit your needs.

Because at the end of the day, it’s about building a business that’s stronger, more future-ready, and gives you and your family the security and freedom you dreamed of.

Every MSME scheme, loan, or grant you access to is a chance to scale your business with the right guidance. With the support of a best business coach or the insights you gain from business coaching, these opportunities can transform into real growth.

Don’t shy away from exploring them! Instead…

• Welcome them.
• Understand how they apply to your business.
• Use them to fuel growth and long-term stability.

If you’ve read till here, it shows you’re serious about growth and maybe even thinking, “I need a business coach to guide me through this.”

So register for this 3-day in-person business program by Rajiv Talreja, India’s MSME Business Coach and get clarity of holistic goals – setting team goals, personal goals, business financial goals, and functional goals.

 FAQs – MSME Schemes, Loans & Grants