Incentive Scheme for MSMEs in Powerloom Sector: Interest Subsidy on Term Loan
Incentive Scheme for MSMEs in Powerloom Sector - Interest Subsidy on Term Loan is a Government of West Bengal incentive implemented through the Department of Micro, Small & Medium Enterprises and Textiles, notified on 20 December 2021, and effective from 1 January 2022 to 31 December 2024.
The scheme aims to reduce the financial burden of borrowing for MSMEs in the powerloom sector by providing a subsidy on interest paid on term loans taken for approved projects. For you as an MSME, this incentive improves project viability and reduces cost of capital.
Key Features
- Interest cost reduction: Provides subsidy on interest paid on term loans taken for setting up or expanding powerloom units.
- Support for technology upgradation: Encourages investment in modern shuttle-less powerloom machinery.
- Applicable to bank-financed projects: Only loans from approved banks and financial institutions are eligible.
- Time-bound benefit: Interest subsidy available for a fixed duration under the scheme.
- Encouragement for formal financing: Promotes structured borrowing and financial discipline.
- Annual reimbursement system: Subsidy provided after verification of interest payments.
Financial Assistance
Eligibility Criteria
- Must be a Micro, Small or Medium Enterprise (Powerloom sector)
- Must be located in West Bengal
- Must have Udyam Registration
- Must have taken term loan from approved bank / financial institution
- Must install approved machinery (shuttle-less powerlooms)
- Project must be approved by Directorate of Textiles
Additional conditions:
- Loan must be used for approved project only
- Regular repayment of loan and interest required
Non-eligibility conditions:
- Enterprises without term loan
- Defaulting borrowers
- Projects without approval
Documents Required
- Udyam Registration Certificate
- Term Loan Sanction Letter
- Bank certificate of interest paid
- Project Report (DPR)
- Invoices for machinery
- Bank account details
Application Process
Option 1: Apply with Bullit, Recommended
Start instantly with our guided application support, where our team verifies eligibility, prepares documentation, and coordinates with the Industries Department on your behalf. Using our business loans and compliance calendar, you can track progress while focusing on project execution, we manage the application end-to-end.
Option 2 : Apply Online (Government Process)
- Register on West Bengal Textile / MSME Portal
- Fill application form (Form-A2)
- Select Interest Subsidy component
- Enter term loan details
- Upload sanction letter and documents
- Submit application
- Verification by Directorate of Textiles and bank
- Submission of interest payment proof annually
- Approval of subsidy amount
- Disbursement of subsidy
- Track application status online