Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs

The Design Scheme sits inside the MSME Innovative Scheme, an initiative of the Ministry of Micro, Small & Medium Enterprises, Government of India. Its purpose is to place professional design expertise within reach of small businesses — the kind of expertise that usually stays out of budget for units of that size — and let them use it to build stronger products.

Work under the scheme runs on two separate tracks.

Design Projects is the funding track. An enterprise can bring in experienced design professionals to work on a fresh product idea or to rework something it already manufactures, with the government bearing the larger share of the cost. The assistance is earmarked for hiring design consultants and for expenses connected to prototyping and product development, so a concept can travel from a drawing board to something a customer can actually buy.

Design Awareness Programme is the educational track. Through seminars, talks and workshops, it builds a wider appreciation of what design contributes to a business and nudges enterprises towards treating design thinking as part of their everyday operations rather than a one-off expense.

The logic behind the scheme is straightforward. Better-designed products hold their ground in the market, and this programme gives MSMEs both the funding and the specialist guidance needed to get there.

There is no closing date to watch for — applications are accepted on a rolling basis, so an enterprise can apply whenever its project is ready.

• Up to ₹40 lakh in grant support for a single MSME design project
• Government share of project cost: 75% for micro units, 60% for small and medium units
• Funds both new product development and upgrades to products already on the market
• Student design projects can receive up to ₹2.5 lakh, with 75% of the cost covered
• Design consultancy, prototype development, mentorship and incubation support included
• Applications are accepted on a rolling basis, with no fixed deadline

Who can apply: the beneficiary unit must be a registered micro, small or medium enterprise.

Registration proof is the key requirement at the application stage. The unit needs to hold either a valid Udyam Registration certificate (the current format) or an Udyog Aadhaar Memorandum (UAM) obtained earlier.

The application is validated against the Udyam Registration Number, so the registration should be active and the mobile number linked to it should be accessible, since that number is used during the online verification step.

For the Student Project route, the design work must be carried out by bona-fide students working for an MSME.

Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs is open to startups at any stage. It is open to startups registered anywhere in India.

Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs accepts applications on a rolling basis — there is no fixed cut-off date, so eligible startups can apply at any time. Because rolling programmes can pause without notice, confirm the window is still open on the official site before you start.

Design Projects — grant against project cost

The Government of India funds a defined share of the total project cost, and there is a ceiling on how much it will put in:

• Micro enterprises: 75% of the project cost
• Small and medium enterprises: 60% of the project cost
• Maximum government contribution: ₹40 lakh (₹40,00,000)

The remaining project cost is borne by the MSME and deposited with the Implementing Agency.

The grant reaches the enterprise in three milestone-linked instalments:

• 40% at the Strategy & Concept stage
• 30% at the Detail Design stage
• 30% after the prototype/product is completed and the final report is submitted

Student Project — separate support

Design work carried out by bona-fide students for an MSME can attract up to ₹2.5 lakh (₹2,50,000), with the government meeting 75% of the total student project cost.

Beyond the money

Approved units also receive specialist design advice from experienced designers, along with mentorship and incubation support. The Design Awareness Programme adds seminars, talks and workshops that help an enterprise understand how design can drive business growth and innovation.

Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs is offered by Ministry of MSME, a government body. As a government-backed grant, it is publicly funded and open to eligible startups across India. You can verify current details and timelines on the provider's official website before applying.

Proposals are assessed on how closely they match what the scheme sets out to do. The review looks at the innovative potential of the design, whether the plan for developing the prototype or product is realistic, and the difference the project is likely to make to the MSME.

The evaluation is carried out by a committee of experts. Shortlisted enterprises may be invited to make a presentation or attend an interview, where the viability of the project and the expertise of the design consultant they have engaged are examined.

That assessment decides whether the project is approved and taken forward for funding.

Before you apply to Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs, keep the following documents ready:

• A pitch deck or short business plan describing the problem, product and traction
• Company registration documents and PAN
• Founder identification (PAN / Aadhaar) and brief profiles
• Recent financial statements or projections
• Product details — a demo, prototype or working link if available

Exact requirements are confirmed on the official application portal — treat this as a preparation checklist.

Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs is best suited for startups in India seeking non-dilutive funding of ₹40L. If that describes your startup, review the eligibility criteria above before applying.