The Interest Subsidy component under the “Motivation of Entrepreneurs to Start Industries and Fiscal Assistance to Industries” scheme is a progressive initiative by the Industries and Commerce Department, Union Territory of Puducherry. This scheme aims to encourage entrepreneurship among marginalized communities (SC/ST/Women/Physically Handicapped/Ex-Servicemen) and promote industrial growth in the region by providing financial relief through interest subsidies on loans availed for fixed assets and working capital.
Under this program, eligible industries can avail an interest subsidy of up to 25% of the annual interest paid, subject to specified limits. The subsidy is disbursed through financial institutions and is applicable for industries that have commenced production on or after specific dates, depending on their category.
Key Benefits of the Scheme
- Subsidy Rate: 25% of the annual interest amount paid.
- Duration: Up to 5 years from the date of commencement of commercial production.
- Maximum Subsidy Amounts:
- For industries set up by SC/ST/Women entrepreneurs commencing production on or after 2-8-2004: ₹75,000 per annum.
- For industries set up by SC/ST/Women/Physically Handicapped/Ex-Servicemen entrepreneurs commencing production on or after 24-8-2011: ₹5,00,000 per annum.
- Eligibility Categories:
- Industries set up by SC/ST/Women/Physically Handicapped/Ex-Servicemen entrepreneurs.
- Thrust Area Industries or IT Sector Industries.
Eligibility Criteria
To qualify for the Interest Subsidy scheme, applicants must meet the following criteria;
General Eligibility
- Entrepreneur Category: The industry should be set up by SC/ST/Women/Physically Handicapped/Ex-Servicemen entrepreneurs, OR classified as a Thrust Area Industry or IT Sector Industry.
- Loan Availment: The industrial unit must have availed a loan from a recognized financial institution for the creation of fixed assets and working capital.
- Commencement of Production:
- For SC/ST/Women entrepreneurs: Production must have commenced on or after 2-8-2004.
- For SC/ST/Women/Physically Handicapped/Ex-Servicemen entrepreneurs: Production must have commenced on or after 24-8-2011.
Financial Institution Coverage
- Recognized financial institutions include:
- PIPDIC (Puducherry Industrial Promotion and Development Corporation).
- Government corporations.
- Scheduled banks, including cooperative banks and government cooperative societies.
How to Apply – Offline Process
The application process for the scheme is entirely offline and involves the following steps;
Step 1: Obtain Application Form
- Visit the Official Website of the Directorate of Industries and Commerce, Puducherry to download the prescribed application form.
Step 2: Fill the Application Form
- Complete all mandatory fields in the application form.
- Attach self-attested copies of all required documents.
Step 3: Submit the Application
- Submit the duly filled and signed application form along with the supporting documents to the concerned authority.
- Request a receipt or acknowledgment slip containing essential details such as the date and time of submission, and a unique identification number (if applicable).
Step 4: Processing
- Applications will be processed by the Industries Department without requiring approval from the State Level Committee.
Essential Documents
To ensure a smooth application process, gather the following documents;
- Entrepreneurs Memorandum Part-2 (UAM/PMT) Registration/Commencement of Production Certificate.
- Caste Certificate: Issued by a competent authority for SC/ST entrepreneurs.
- Loan Sanction Letter: From the financial institution/bank.
- Purchase Invoices: For plant & machinery, pollution control equipment, and generators.
- Chartered Accountant Certificate: For investment in fixed assets, pollution control equipment, and generators.
- Month-wise Interest Paid Statement: From the financial institution/bank, along with a No-Due Certificate.
- List of Employees: Covered under the Provident Fund Scheme, along with wage/salary payment particulars.
- Provident Fund Remittance Details: For the claiming period.
- Notary Affidavit: As required.
Frequently Asked Questions (FAQs)
Are there any deadlines for submitting applications?
Yes, applications must be submitted within one year from the date of obtaining the Entrepreneurs Memorandum Part-2/Permanent Registration/Commencement of Production Certificate for new units. For existing units undergoing expansion/diversification/modernization, applications must be submitted within one year of completion.
What is the purpose of the ‘No Due Certificate of Interest’?
The certificate confirms that the applicant has no outstanding dues for interest payments to the financial institution, ensuring transparency and compliance.
Why is a month-wise interest paid statement necessary?
The statement provides a detailed record of interest payments made during the claiming period, enabling accurate calculation of the subsidy amount.
Is a caste certificate necessary for all applicants?
No, only SC/ST entrepreneurs are required to submit a caste certificate.
Which financial institutions are considered under the scheme?
Recognized financial institutions include PIPDIC, government corporations, scheduled banks, cooperative banks, and government cooperative societies.
What are the conditions regarding loans availed by industrial units?
The loan must be availed for the creation of fixed assets and working capital from a recognized financial institution.
Through what mode is the subsidy disbursed?
The subsidy is disbursed through the financial institution that provided the loan.
How is the interest subsidy disbursed for industrial units in government-owned premises?
The subsidy is disbursed through the same mechanism, irrespective of the location of the industrial unit.
What is the maximum interest incentive admissible to an industry?
For SC/ST/Women entrepreneurs, the maximum is ₹75,000 per annum. For others, it is ₹5,00,000 per annum.
How are applications processed?
Applications are processed by the Industries Department, and approval is not required from the State Level Committee.
Conclusion & Important Links
The Interest Subsidy scheme under the “Motivation of Entrepreneurs to Start Industries and Fiscal Assistance to Industries” is a vital initiative aimed at empowering marginalized entrepreneurs and fostering industrial growth in Puducherry. By providing financial relief through interest subsidies, the scheme reduces the burden of loan repayments and encourages investment in fixed assets and working capital.
If you’re an entrepreneur from a marginalized community or setting up a Thrust Area Industry or IT Sector Industry, take advantage of this opportunity to secure affordable credit and drive your business forward. Download the application form today and apply offline to benefit from this transformative scheme!
