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Summary Credit Linked Capital Subsidy Scheme assists in the technological up gradation of MSEs by giving capital security of 15 percent (on institutional financial of up to Rs 1 crore availed by them) for introducing advanced technology in the approved 51 subsectors/ goods. Its primary intention should be to upgrade the rose and machinery with most advanced technology of existing units and in addition for newly set up MSEs. The structure is based on demand without any uppr limit on overall annual spending on the subsidy disbursal.

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Micro, Small and Medium Companies (MSME) sectors are the primary chains of economic growth and development of the Of india economy. It is a vibrant sector which continues the happy legacy of Indias liberty movement. It provides immense employment opportunities at a smaller cost than large sectors. It takes on a significant role in fortifying rural and backward areas. It helps in reducing attention of financial power and wealth. This kind of sector leads to the socio-economic development of the nation. It answers the needs of the little entrepreneurs with low capital and thus assists with the overall empowerment of the persons. Due to too little capital and widespread unawareness micro and small enterprises were performing operations with outdated technology. It was indeed difficult for people enterprises to keep up with global specifications and encounter competition. Hence their endurance mainly depended on modernisation and technological up gradation. In the light of these events, credit-linked capital subsidy scheme was introduced. In the 2018 Central Government budget, special concentrate was put on refreshing and building up the credit-linked capital security scheme.


  • To list out the targets of CLCSS scheme.
  • To sophisticated the procedure for availing financial loans under this kind of scheme
  • To graphically stand for the stream of this system
  • To state the performance of this scheme


Extra data regarding the research content has been obtained from online websites and journals.


This scheme was introduced in launched in October-2000 and revised by 29. being unfaithful. 2005. Optimum limit of eligible financial loan for calculation of subsidy under the structure is Rs. 100 lakhs. Presently, a lot more than 1500 very well established/improved technologies under 51 sub-sectors had been approved underneath the Scheme.


The objective of this structure is to aid the technical up succession of MSEs by providing a capital security of 12-15 percent (on institutional finance of up to Rs 1 crore availed by them) to get introducing sophisticated technology inside the approved fifty-one subsectors/ goods. Its key intention is to upgrade the plant and equipment with the latest technology of existing units and in addition for newly set up MSEs. The system is based on demand without any uppr limit on overall gross annual spending on the subsidy disbursal. The modified scheme gives 15% in advance capital subsidy to MSEs, including tiny, khadi, village and coir industrial models, on institutional finance utilized by these people for inauguration ? introduction of well-established and improved technologies in specified sub-sectors/products approved beneath the scheme.


Just micro and small corporations with a Udyog Aadhaar Memorandum (UAM) amount can benefit from this scheme.


The scheme is currently scheduled to become in operation up to March 23, 2007or until the time calamité of mixture capital subsidy disbursed by the Nodal Companies reaches Rs. 600 crore, whichever can be earlier. SALIENT FEATURES The Credit Linked Capital Subsidy Scheme (CLCSS) was launched upon 1st October, 2000. The Cabinet Committee on Monetary Affairs (CCEA) has permitted the changes in ceiling of credit from 40. 00 lakhs to 1. 00 crore with the rate of subsidy enhanced via 12% to 15% with effect coming from 29th Sept. 2010, 2005. RANGE Currently, the scheme delivers subsidy to 51 sub-sectors/products including Khadi and Small town Industries. But since the scheme expanded, a brand new list of products/sub-sectors has been included by setting up new technologies/products/sub-sectors with the authorization of the Technical Sub-Committee (TSC) and Governing and Technology Approval Board (GTAB) from the CLCSS.

The system would cover the following technology needs / products/sub sectors:

1 . Biotech Industry

installment payments on your Common Liquid Treatment Herb

3. Corrugated Boxes

4. Drugs and Pharmaceuticals

a few. Dyes and Intermediates

6th. Industry based on Medicinal and Aromatic plants

7. Plastic-type Moulded/ Extruded Products and Parts/ Components

almost eight. Rubber Control including Cycle/ Rickshaw Tyres

9. Food Processing (including Ice Cream manufacturing)

10. Poultry Hatchery Cattle Feed Industry

11. Dimensional Stone Industry (excluding Quarrying and Mining)

12. Cup and Porcelain Items including Tiles

13. Leather and Leather Items including Boots and Garments

14. Electric equipment viz test, computing and assembly/ manufacturing, Commercial process control;Analytical, Medical, Electronic Consumer Communication equipment and so forth

12-15. Fans Motor Industry

sixteen. General Lumination Service(GLS) lights

17. Information Technology (Hardware)

18. Mineral Filled Sheathed Heat Elements

nineteen. Transformer/ Electric Stampings/ Laminations /Coils/Chokes which include Solenoid shelves

20. Wire connections Cable Sector

21. Auto Parts and Parts

22. Bicycle Parts

twenty-three. Combustion Devices/ Appliances

24. Forging Hands Tools

twenty-five. Foundries Metallic and Solid Iron

twenty six. General Executive Works

28. Gold Plating and Jewellery

28. Locks

29. Stainlesss steel Furniture

31. Toys

31. NonFerrous Foundry

32. Sport Goods

33. Cosmetics

thirty four. Readymade Apparel

35. Wood Furniture

36. Mineral Water Container

37. Chemicals, Varnishes, Alkyds and Alkyd products

37. Agricultural Accessories and Post Harvest Tools

39. Beneficiation of Graphite and Phosphate

40. Khadi and Small town Industries

41. Coir and Coir Items

42. Metal Rerolling and /or Pencil Ingot producing Industries

43. Zinc Sulphate

44. Welded Electrodes

forty-five. Sewing Equipment Industry


This kind of Scheme is linked with term loans availed by the MSEs from Banking institutions or Financial Institutions.

1 ) To claim subsidy under CLCSS, eligible MSEs are required to apply online through Primary Providers (PLIs), coming from where the MSEs availed term loan pertaining to up-gradation of technology.

2 . The completed software is then uploaded by PLI through On-line Application and Tracking System to the attached Nodal Agency, which, in turn, recommends the applying online to Office of DC (MSME) for release of subsidy.

several. After digesting of program and controlled by availability of cash, due acceptance is accorded from skilled authority and concurrence of Internal Finance Wing, after which funds happen to be released to Nodal Firms.

4. Funds will be then transferred by the Nodal Agencies for the PLIs in which the account of the MSE functions.


Presenting, 12 nodal banks/agencies including SIDBI and NABARD are applying this structure. All the other crucial banks/agencies is only going to accept plans in respect of credit rating approved by all their respective divisions. SIDBI and NABARD are responsible for the release of subsidy. SME units can assert subsidy through online program and monitoring system that can be introduced from 01. 15. 2013. Subsidy claim app must be published through Primary Lending Institutions (PLI). PERFORMANCE Overall performance of Credit Linked Capital Subsidy Structure (CLCSS) through the inception (2001-02) upto 2016-17 is given listed below: Year No . of MSE Beneficiaries Total Amount of subsidy introduced (Rs. Crore) 2001-02 to 2011-12 16295 854. 05 2012-13 5713 343. seventy nine 2013-14 6279 421. twenty four 2014-15 7246 448. 85 2015-16 5047 322. 44 2016-17 4011 256. 53 2017-18 (Upto 30. 2009. 2017) 4027 257. 39 Source: A diagrammatic rendering of the flow of the structure is given listed below: – Fig: Secondary Data.


The credit-linked capital security scheme (CLCSS) has helped in the technical up gradation of Tiny and Little Enterprises (MSEs) and also in installing cutting edge technology in such devices. Efforts are being created to reintroduce this system with very much vigor to uplift the micro and small businesses as they form the backbone in the economy. This kind of scheme helped the MSEs to stand at par with global standards and sophisticated technology. This helps them to face competition and keep up with global specifications. Thus this scheme will prove to be a major breakthrough in upgrading the technology from the micro and small corporations.

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