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

The maximum government contribution is ₹40 lakh (₹40,00,000). Within that ceiling, the Government of India pays 75% of the total project cost for micro enterprises and 60% for small and medium enterprises. Whatever is left of the project cost is funded by the MSME itself and deposited with the Implementing Agency.

No. The Design Scheme is a grant programme, which means the government contribution is non-dilutive — you do not give up any ownership or stake in your enterprise in return. Your only financial commitment is the balance of the project cost that the government does not cover.

The beneficiary unit must be a registered micro, small or medium enterprise. Where a Student Project is involved, the design work has to be done by bona-fide students working for that MSME.

Yes. You must hold a valid Udyam Registration certificate, or an Udyog Aadhaar Memorandum (UAM) obtained earlier. The online application validates your details against your Udyam Registration Number, so the registration needs to be live and the mobile number linked to it should be reachable.

There is no fixed closing date. The scheme runs on a rolling, always-open basis, so you can submit an application whenever your project plan and design proposal are ready.

It comes in three instalments tied to project milestones. The first 40% is released at the Strategy & Concept stage, the next 30% at the Detail Design stage, and the final 30% once the prototype or product is finished and the final report has been submitted.

Yes. A separate Student Project component supports design work carried out by bona-fide students for an MSME, with financial assistance of up to ₹2.5 lakh (₹2,50,000). The Government of India covers 75% of the total student project cost.

For Design Projects, the assistance is earmarked for engaging design consultants and for expenses relating to prototype and product development. That covers the work of converting a concept into a tangible, market-ready product, or substantially improving something the enterprise already sells.

It is the awareness-building arm of the scheme. Through seminars, talks and workshops, it helps MSMEs understand the strategic value of design and encourages them to build design thinking into their core business processes, so innovation becomes an ongoing habit rather than a one-time project.

Start by visiting the official MSME Innovative Scheme portal at https://innovative.msme.gov.in/. Click on the "Design" option to reach the Design Scheme section, then click "Join Design Scheme". Enter your Udyam Registration Number and the registered mobile number linked to your MSME, and click "Validate" to verify the details. Once validated, complete the rest of the online form, which will ask for your project details, design proposal and financial requirements.

No. DPIIT (Startup India) recognition is not listed as a mandatory requirement for Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs, though having it can strengthen your application and unlock other benefits.

Design Scheme (MSME Innovative) — Up to ₹40L Grant for MSMEs is offered by Ministry of MSME, a government body. It is provided as non-dilutive funding.