Special Credit Linked Capital Subsidy Scheme (SCLCSS)
The SCLCSS is a scheme run by the Ministry of Micro, Small & Medium Enterprises , Government of India. It was launched under the umbrella of the National SC‑ST Hub to promote and support Micro and Small Enterprises owned by Scheduled Castes and Scheduled Tribes . The purpose of the scheme is to enable such enterprises to access modern plant & machinery or equipment through institutional credit, thereby boosting technology, capacity, quality and participation in public procurement. The benefit to your business is that if you are an SC/ST-owned MSE, you can avail a capital subsidy to offset the cost of new machinery/equipment when you take a bank term loan.
Key Features
- Subsidy of 25% for SC/ST MSEs: Under SCLCSS, if you are an SC/ST-owned micro or small enterprise, when you avail a term loan to purchase new plant & machinery or equipment, the government provides a subsidy equal to 25% of the cost of that machinery/equipment (through the banking route). This effectively reduces your capital cost.
- Ceiling on subsidy up to ₹ 25 lakh: Even though the subsidy rate is 25%, there is a cap. The maximum subsidy you can receive is ₹ 25 lakh per enterprise under this scheme. Thus you plan accordingly.
- Applicable to manufacturing and service MSEs: While many older schemes focussed on manufacturing only, SCLCSS expands coverage to service sector enterprises (subject to guidelines) owned by SC/ST entrepreneurs, thereby broadening your opportunity if you are in services.
- Only new plant & machinery/equipment eligible: The scheme requires acquisition of new (not second-hand) plant & machinery or equipment. This ensures you are upgrading to modern technology rather than re-using old assets.
- Must avail term loan from eligible PLI/Bank: To qualify, you must secure institutional credit (term loan) from a bank or financial institution recognised under the scheme (Primary Lending Institution). The bank then works with nodal agency to claim subsidy.
- Implementation via nodal banks/agencies: The scheme is channelled through nodal banks/agencies like SIDBI, NABARD who handle the subsidy release and coordination with banks and enterprises. The PLI uploads the application, the nodal agency processes and releases the subsidy.
- Registration and ownership criteria (SC/ST): Because this scheme is for SC/ST entrepreneurs’ enterprises, you must show the enterprise is owned by SC/ST category persons (as per caste certificate etc), and fulfil other criteria like Udyam registration.
- MIS portal submission of claims: After loan sanction and purchase of machinery, the PLI/Bank must upload the claim application on a dedicated MIS portal of the National SC-ST Hub. Subsidy release happens only after prescribed documentation is in place.
Financial Assistance
Eligibility Criteria
Who Can Apply:
- SC/ST entrepreneurs owning micro, small or medium enterprises.
- Units registered under Udyam and engaged in manufacturing or services.
- Enterprises requiring technology upgradation or replacement of outdated machinery.
- Units applying for institutional credit for new machinery purchase.
- SC/ST entrepreneurs with majority ownership and control in the enterprise.
Who Cannot Apply:
- MSMEs not owned by SC/ST entrepreneurs.
- Units not registered under Udyam or lacking valid enterprise documentation.
- Enterprises seeking subsidy for second-hand, used or refurbished machinery.
- MSMEs already availing overlapping subsidies for the same equipment.
- Units classified as NPAs, financially irregular or non-operational.
Documents Required
- SC/ST entrepreneur identity and caste certificate
- Udyam Registration Certificate
- KYC documents of enterprise and promoters
- Project report or machinery purchase plan
- Machinery quotations
- Bank loan application and sanction letter
- Financial statements, if applicable
- Enterprise ownership documents
- Bank account details
Application Process for the Scheme
Option 1: Apply with Bullit (Recommended)
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Option 2: Apply through Lending Institutions (Official Process)
- Approach an eligible lending institution with project details and machinery requirements.
- Apply for a term loan for technology upgradation.
- Submit SC/ST ownership documents and business credentials.
- The bank processes and sanctions the loan as per its norms.
- The lending institution submits subsidy claims under SCLCSS.
- Subsidy is released to the bank and adjusted against the borrower’s loan liability.
Power Combos with The Scheme