§1Who it is for

  • New micro and small enterprises with term loans

Useful if

Loan-financed new micro/small units

Do not spend time on it if

Self-financed units

§2Eligibility

  1. New micro & small only - not for expansion/diversification
  2. Loans from scheduled banks, FIs, APSFC (Telangana unit), SIDBI, RBI-recognised NBFCs
  3. Only loan disbursed within 6 months of commercial production; second loans after DCP ineligible

§3Benefits

  • Interest above 3% p.a. reimbursed, max 9% p.a., for 5 years from commencement of commercial production

§4Norms — pattern of assistance

  1. Unit bears minimum 3% interest

§5Documents

Tick each one as you get it ready.

§6How to apply

  1. 1

    Half-yearly claims on TG-iPASS (Annexure-VI)

§7Pros and cons

Merits

  • Brings effective interest down to 3%

Demerits

  • Not for expansion

→Related schemes

Need help with Pavala Vaddi?

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

WhatsApp usServices

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

Sources

  1. Telangana Operational Guidelines for Implementation of MSME Policy (Incentive Scheme) 2024, Commissionerate of Industries

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