Madhya Pradesh Startup Policy 2022: Margin Money & Interest Subsidy Scheme
Department of MSME, Government of Madhya Pradesh · Central government
Provides margin money and interest subsidy for DPIIT-recognised startups in Madhya Pradesh.
Open, rolling. Applications are accepted continuously — there is no deadline.
Key facts
- Subsidy amount
- Up to ₹47,00,000
- Instrument
- Subsidy
- Deadline
- Rolling
- Disbursement
- Reimbursed after spend
About this scheme
The Madhya Pradesh Startup Policy 2022 includes a Margin Money & Interest Subsidy Scheme, administered by the Department of MSME, Government of Madhya Pradesh. This department is responsible for industrial growth and supporting micro, small, and medium enterprises in the state. The policy is intended to build a startup ecosystem by offering financial support to new ventures.
Eligible startups can receive margin money assistance of up to 15% of the sanctioned term loan, with a maximum cap of ₹12,00,000 (₹12 Lakh). This reduces the upfront equity required. An annual interest subsidy of 5% is also available on term loans from scheduled banks or approved financial institutions, capped at ₹5,00,000 (₹5 Lakh) per year, for a period of up to seven years.
The funding covers business operations and setup costs typically financed by a term loan, including asset acquisition, infrastructure, and operational expenses. For startups majority-owned by founders from Scheduled Caste (SC), Scheduled Tribe (ST), Other Backward Classes (OBC) categories, or by women entrepreneurs, the interest subsidy is increased to 6%.
Who can apply
- Eligible business forms
- Private limited company, Limited liability partnership, Partnership firm
- Udyam registration
- Not specified
- MSME registration
- Not specified
- DPIIT startup recognition
- Required
- GST registration
- Not specified
- Where the business may be based
- Madhya Pradesh
- Startup must hold valid DPIIT recognition from the Department for Promotion of Industry and Internal Trade, Government of India. - Startup must be officially registered and operating within Madhya Pradesh. - Must have a sanctioned term loan from a scheduled commercial bank, NBFC, or other approved financial institution, intended for eligible business operations or setup costs. - Term loan must be issued exclusively in the startup's name. - For enhanced interest subsidy, verified majority ownership by founders from SC, ST, or OBC categories, or by women entrepreneurs, is required; documentary proof is necessary.
How to apply
- Begin by registering on the MP Startup portal, the central platform for all state-level startup schemes, and complete the application through it. - Attach the DPIIT recognition certificate to confirm startup status, along with the loan sanction letter from the financial institution that specifies the approved term loan. - Include a detailed loan repayment schedule from the bank or financial institution, which is essential for determining and verifying the annual interest subsidy amount. - For enhanced benefits, provide category certificates (SC, ST, OBC) or documentation confirming majority women ownership. - Submit accurate bank details, including account number and IFSC code, to ensure direct and timely disbursement of approved margin money and interest subsidies.
How applications are assessed
Applications begin on the MP Startup portal, where applicants submit proof of their loan, interest payments, and DPIIT status. Each submission is checked against the lending conditions set out in the Madhya Pradesh Startup Policy 2022. Startups that pass this review are granted margin money assistance and an interest subsidy on eligible loans.
Frequently asked questions
What financial benefits are available under this scheme?
The scheme provides margin money support of up to 15% of the term loan, with a ceiling of ₹12,00,000, along with an annual interest subvention of 5% on the loan, capped at ₹5,00,000 per year for a maximum of 7 years.
What are the primary eligibility criteria for startups?
Startups must hold DPIIT recognition, be formally registered in Madhya Pradesh, and have a sanctioned term loan from an approved financial institution for business operations or setup.
How are the subsidies disbursed to eligible startups?
The interest subsidy is paid out once a year, computed from the interest the startup has actually paid on its term loan. Margin money is released according to the conditions of the sanctioned loan and the scheme’s guidelines.
Are there any enhanced benefits for specific founder categories?
Yes, startups with verified majority ownership by SC, ST, OBC, or women founders qualify for an enhanced interest subsidy of 6%.
What kind of expenses can the term loan cover under this scheme?
The funding covers business operations and setup costs normally financed by a conventional term loan, including asset acquisition, infrastructure setup, and operational expenses linked to growth.
Sectors
- Interest Subsidy
- Margin Money
- Equity Free
- Dpiit
- Madhya Pradesh
Details last verified on 3 August 2026. Source: the issuer's published information.