Sustainable Finance Scheme

The Sustainable Finance Scheme is run by Small Industries Development Bank of India . It was launched to support sustainable development projects in the MSME sector . The purpose of the scheme is to provide financing to projects promoting energy-efficiency , cleaner production , renewable energy, waste management, green-buildings and other eco-friendly investments in Micro, Small and Medium Enterprises . Your business as an MSME/startup can benefit by accessing this scheme when you plan investments in green technologies or sustainable operations.

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

Key Features

Wide scope covering energy-efficiency and cleaner production: The scheme enables MSMEs to invest in measures that reduce resource consumption, pollution and operational costs by focusing on energy-eco friendly technologies or cleaner manufacturing.
Eligibility of new & existing MSMEs with good track record: Both fresh units and established ones qualify; for existing ones the scheme requires historical sound performance, no default and stable financial footing so that your business’s viability is clear.
Support for renewable energy and green technologies: Your business can get funding if you plan to install solar panels, wind turbines, biomass gasifiers, or adopt green-building practices, waste management systems or eco-labelling.
Flexibility in type of assistance (term loans / working capital / equipment finance): The scheme covers different forms of finance—whether you need a term loan to buy equipment, working capital for implementing green processes, or finance for equipment manufacturing/supply itself.
Interest rate based on MSME credit rating: Rather than a flat concessional rate, the interest applied will depend on your company’s credit rating or internal assessment of risk—so better credit standing means better cost of finance.

Financial Assistance

Component	Assistance Provided	Detailed Explanation
Term Loans / Capex for Green Investment	Financing for equipment, civil works, retrofits	If you as an MSME plan to purchase a new energy-efficient furnace or install solar panels, the scheme covers the equipment cost, installation and related civil works. Example: You upgrade to a new furnace and apply under SFS to fund purchase + installation.
Working Capital / Equipment Finance for Green Supply Chain	Finance for green equipment supply or green process working capital	If you manufacture green equipment or supply to other MSMEs (e.g., energy efficient pumps), you can get funding for the needed machinery or working capital. Example: Your firm supplies solar water-pumping systems and uses SFS finance to ramp up production or inventory.
Non-capital support: Certification / Audit / Environmental Compliance	Funding for audits, certifications, rating etc	If you need to get an energy audit, BEE star rating, eco-labelling or green certification to qualify for efficient operations, the scheme supports this cost. Example: You decide to get ISO 50001 and apply to fund the audit under SFS.

Eligibility Criteria

Who can apply:

Your business must be a micro, small or medium enterprise as defined under the MSMED Act.
Existing units must have a proven track record, be financially sound and not in default to any bank or financial institution.
Your project must pertain to renewable energy, cleaner production, waste management, green building, eco-labelling or related sustainable operations.
Original equipment manufacturers (OEMs) making green equipment and/or supplying to MSMEs may be eligible if they qualify as MSME themselves or have compliant supply network.
Units in default, units without required credit rating or units not meeting the sustainability criteria are not eligible.

Documents Required

MSME registration certificate (Udyam/Acknowledgement)
Identity proof & address proof of proprietor/partners/directors
Financial statements of the unit (last 2-3 years)
Credit rating or internal rating proof
Detailed project report (DPR) or technical audit (especially for energy efficiency/clean production)
Bank account details, KYC documents
Environmental/technical approvals if required (for renewable energy/waste management)
Equipment specifications, cost estimates, vendor quotations

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: MSME business owners who want expert assistance in submitting for the SFS, reducing paperwork and process burden.

Option 2: Direct Government / SIDBI Process

Visit the SIDBI website or contact the SIDBI branch or approved financial institution offering the SFS scheme.
Submit project proposal including energy audit/DPR (detailed project report) for energy-efficiency/clean production measure.
Provide financial statements, credit‐rating details, and proof of MSME registration.
On approval, draw the credit facility under the terms of SFS and execute the project.
Monitor the implementation and ensure compliance with scheme terms (e.g., equipment specification, environmental standards).

Option 3: Through Financial Institution Partner
Some banks or NBFCs may be partners of SIDBI and can offer the SFS credit line. Approach your bank, mention SFS, and ask for the required documentation and procedure.