§1Who it is for

  • New MSME manufacturing units and expansion projects; only new service MSMEs listed in Annexure I

Useful if

Bank-financed manufacturing MSMEs in DNH & DD.

Do not spend time on it if

Traders and most service businesses.

§2Eligibility

  1. Manufacturing: term loan on new machinery, equipment, building, furniture/fixtures (not land)
  2. Services: only new MSMEs in Annexure I list; loan on equipment/machinery/furniture (not land and building); GST registration; at least 10 permanent local jobs; shop & establishment registration if in municipal area
  3. Bank/financial institution loan per RBI rules; NBFC loans not eligible
  4. Term loan sanctioned within one year of commercial production
  5. Commercial production between 20 May 2022 and 19 May 2027

§3Benefits

  • 50% of interest charged by bank, max ₹30 lakh a year, for 5 years or loan repayment period, whichever is earlier
  • +10% for differently-abled, women entrepreneurs and DPIIT-registered startups
  • +10% for entrepreneurs below 35 on the date of loan sanction

§4Norms — pattern of assistance

  1. Unit must bear at least 2% interest itself
  2. No subsidy on penal interest or bank charges; default periods deducted
  3. Paid directly to the bank every 6 months (30 Sep and 31 Mar)
  4. From first disbursement or commercial production, whichever is later

§5Documents

Tick each one as you get it ready.

Partnership deed or MoA/AoA

§6How to apply

  1. 1

    Online on swp.dddgov.in within one year of first disbursement or of commercial production, whichever is later

§7Pros and cons

Merits

  • High rate (50%, up to 70% with add-ons) and high cap (₹30 lakh/yr)
  • Young (<35), women and startup founders get extra 10% each

Demerits

  • Most service activities excluded unless in Annexure I
  • Unit must still pay at least 2% interest

→Related schemes

Need help with DNH&DD interest subsidy?

Eligibility check, DPR and application file — ask us on WhatsApp.

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Our interestHelp is our paid service. You can also apply for the scheme yourself.

Sources

  1. IPS 2022 - Gazette of DNH & DD, 20 May 2022
  2. myScheme - IPS Assistance of Interest Subsidy

Checked on 18 October 2026. For information only — confirm with the department or bank. Spotted a mistake? Report it.