Credit Linked Capital Subsidy Scheme or CLCSS for technology upgradation was launched in October 2000 by the Government of India. The said scheme is directed towards MSMEs to help them improve their technology for optimising revenue generation. However, to become a beneficiary of this scheme, individuals need to meet specific eligibility criteria, among other requirements.
MSMEs in India are often forced to work with obsolete technology due to a shortage of funds. However, this innovative credit scheme functions to help MSMEs located in rural and semi-urban areas improve their existing technology and equipment.
CLCSS was introduced by the Ministry of Micro, Small and Medium Enterprises to boost production of small scale industries by providing them access to subsidised capital. Under this scheme, eligible enterprises can enjoy a capital subsidy of 15% on loan availed from a financial institution.
The primary objectives of this scheme can be described as the intention to upgrade the plant and machinery of enterprises with state-of-art technology, irrespective of expansion. Besides existing MSMEs, new enterprises which have set up as per CLCSS guidelines can qualify as beneficiaries of this scheme.
These are among the most noteworthy characteristics of CLCSS subsidy –
Eligible entities are required to submit a set of documents to back up their eligibility and also to initiate the verification process –
Other than these, applicants may be required to submit other KYC documents to become a beneficiary of the Credit Linked Capital Subsidy Scheme.
These pointers highlight the eligibility criteria for becoming a beneficiary under CLCSS –
This table highlights some approved sectors and sub-sectors that come under CLCSS scheme –
|Common Effluent Treatment Plant
|Drugs and Pharmaceuticals
|Wires & Cable Industry
|Dyes and Intermediates
|Industry based on Aromatic and Medicinal plants
|Plastic Moulded or Extruded Products and Parts
|Poultry Hatchery and Cattle Feed Industry
|Dimensional Stone Industry
|Leather and Leather Products
|Glass and Ceramic Items including Tile
|Fans & Motors Industry
|Forging and Hand Tools
|Gold Plating and Jewellery
|Agricultural Implements and equipment
|Sewing Machine Industry
|Coir and Coir Products
|Copper Strip Industry
|Khadi and Village Industries
To apply for or claim a CLCSS subsidy, you must apply online through Primary Lending Institutions (PLIs) where Micro and Small Enterprises (MSEs) obtain term loans.
By completing these steps, one can apply for the CLCSS scheme successfully –
Step 1 – Apply via a listed financial institution.
Step 2 – Login with User ID and password on MSME’s official website.
Step 3 – Click on ‘Apply for Subsidy’ Link on the User Task menu.
Step 4 – Provide necessary details to continue.
Step 5 – Fill the form by entering details about the machinery or equipment.
Step 6 – Verify the details shared and submit the form.
Once the form is submitted, it will be reviewed after which individuals will receive the application back for clarification. Post clarification, the nodal verification of the said application will be forwarded for loan sanction based on applicant’s eligibility, urgency level and availability of funds.
Applicants can track the status of their application online or by contacting the concerned nodal officer. On sanction, the funds are transferred to the designated nodal agency and will subsequently be disbursed to the financial institution where the applicant holds an account.
By availing of the Credit Linked Capital Subsidy Scheme, small-scale industries can benefit in the following ways –