Back-Ended Interest Subsidy schemes (BEIS)

The Back-Ended Interest Subsidy (BEIS) Scheme is administered by the Department of Micro, Small & Medium Enterprises, Tamil Nadu (MSME Department), Government of Tamil Nadu. The scheme was introduced under the Tamil Nadu MSME Policy to reduce the interest burden on micro and small manufacturing enterprises that avail term-loans for technology upgradation, modernisation, ISO certification, R&D and similar eligible purposes. Your enterprise can benefit by receiving interest subsidy over a period by way of reimbursement to the lending financial institution.

Key Features
Financial Assistance
Eligibility Criteria
Documents Required
Application Process for the Scheme

Key Features

Eligible loan types & activities: The scheme covers term loans taken by micro and small manufacturing enterprises for technology up-gradation / modernisation; loans under schemes like Credit Linked Capital Subsidy Scheme (CLCSS) / CGTMSE / NSIC-SIDCO Consortium / ISO certification / R&D.
Subsidy rate and duration: The subsidy rate is 3% interest subsidy for a maximum duration of 5 years.
Maximum subsidy amount & loan ceiling: The maximum amount of back-ended interest subsidy payable per loan is ₹10 lakhs for loans up to ₹100 lakhs.
Back-ended reimbursement mode: The subsidy is reimbursed to the financial institution (bank/term-loan provider) on a quarterly basis, provided the unit is regular in repayment. Penal interest or delayed payment charges are not covered.
Nodal Agencies: The nodal agencies differ based on lender: Tamil Nadu Industrial Investment Corporation Ltd. (TIIC) for loans sanctioned by TIIC; Small Industries Development Bank of India (SIDBI) for loans by SIDBI; General Managers of District Industries Centres (DICs) for loans by other banks.

Financial Assistance

Component	Assistance Provided	Detailed Explanation & Example
Subsidy on interest	3 % interest subsidy for up to 5 years	Example: If your term loan interest is 10 % p.a., this scheme can reduce it effectively to 7 % (via subsidy) for up to 5 years.
Maximum subsidy amount	Up to ₹10 lakhs per loan	Example: You take a term-loan of ₹90 lakhs for modernization – you may receive interest subsidy up to ₹10 lakhs over the 5 years (subject to guidelines).
Loan ceiling for full benefit	Loans up to ₹100 lakhs eligible	Example: If loan is ₹95 lakhs → eligible; if loan is ₹150 lakhs → full benefit cap may apply (₹10 lakhs maximum subsidy).

Eligibility Criteria

Who can apply:

The enterprise must be a micro or small manufacturing enterprise in Tamil Nadu (not service sector) which has taken a term-loan under technology up-gradation, modernisation, or equivalent eligible purpose.
New enterprises setting up manufacturing facilities or existing manufacturing units undertaking technology up-gradation/modernisation are eligible.
Loan must be sanctioned by lender under eligible scheme or for eligible purpose (such as Credit Linked Capital Subsidy Scheme (CLCSS) / CGTMSE / NSIC-SIDCO Consortium / ISO certification).

Who cannot apply:

Service enterprises (non-manufacturing) are generally not eligible under this scheme.
Units with loan defaults will lose subsidy for the period of default. Penal interest or late charges are not covered.
Application must comply with timeline and documentation as per guidelines.
Activities outside the specified sub-sectors under CLCSS (and other lists) may not qualify

Documents Required

UDYAM / MSME Registration Certificate
Term loan sanction letter from bank/financial institution
Interest certificate of the term loan for the year/quarter concerned
Bank statement showing interest paid / principal repayment
Declaration of technology up-gradation / modernisation (if applicable)
Project report/ activity details for new or up-gradation unit
Proof of being manufacturing enterprise in the state of Tamil Nadu

Application Process for the Scheme

Option 1: Apply with Bullit (Recommended)

Click here to start with guided support. Our team verifies eligibility, compiles documents, and handles application & follow-ups on your behalf. You can monitor progress while focusing on operations.
Recommended for: Enterprises taking term loans for tech upgrade who want full procedural support.

Option 2: Official Government Process

Ensure you have availed a term loan for eligible purposes (technology up-gradation/modernisation/ISO/R&D) from either the Tamil Nadu Industrial Investment Corporation (TIIC), Small Industries Development Bank of India (SIDBI) or a bank.
Register your unit, and via the MSME portal of Tamil Nadu, apply for BEIS scheme by submitting the loan sanction letter and proof you meet the upgrade/modernisation criteria.
Upload required documents: Udyam registration, loan sanction letter, interest payment proof, unit operational certificate.
The nodal agency checks your eligibility, operations status, interest paid and sanction of subsidy is forwarded to the lender. Subsidy will be reimbursed quarterly to the lender.
Monitor quarterly claims - ensure interest payment schedule is followed and documents updated to maintain subsidy eligibility.

Option 3: Offline Guidance via District Industries Centre (DIC)

Visit your local DIC or MSME District Office. They will provide guidance on scheme fitment, document check-list and forwarding applications to TIIC/SIDBI.
After guidance, follow through via online portal or as per the district instructions.

Power Combos with The Scheme