UP Startup Interest Subvention Scheme — 4% Off Loans Up to ₹2 Cr

Carrying a term loan is one of the heaviest fixed costs an early-stage company bears. Built into the Uttar Pradesh Startup Policy, this incentive has the state government absorb a slice of that cost for startups that have borrowed from a scheduled bank or a recognised financial institution.

The relief works out to a 4% per annum interest subvention, capped at ₹2 Crore across three years. Instead of handing cash to the founder, the state routes the subsidy to the lending institution every six months, so the saving surfaces as a smaller interest outgo on the loan account itself.

Because this is a subsidy rather than an investment, no equity or ownership changes hands. The money that stays inside the business can be redirected into operations, expansion or hiring — which ties directly to the policy's stated aim of strengthening cash flow and financial viability for startups registered in the state.

Applications run on a rolling basis with no fixed closing date, and the entire exercise is administered by the nodal agency that runs the UP Startup Policy on behalf of the Government of Uttar Pradesh.

• 4% per annum interest subvention on eligible term loans
• Benefit worth up to ₹2 Crore spread across three years
• Calculated as 4% of the loan or the actual interest paid, whichever is lower
• Paid directly to the bank every half-yearly cycle
• Rolling applications — no fixed deadline to chase
• For startups registered and operating in Uttar Pradesh

• Your startup must hold a term loan from a scheduled bank or a recognised financial institution. Borrowings that don't fit that description fall outside the scheme.
• The business needs to be registered and operating in Uttar Pradesh, not merely planning to move there.
• You must comply with the broader UP Startup Policy guidelines, since this subvention is one component of that policy rather than a standalone programme.
• The scheme's own eligibility list does not explicitly spell out DPIIT recognition, though DPIIT recognition does appear among the documents typically requested when a claim is filed under the policy. Treat it as something to have in order before you apply.
• If your loan structure or registration status is unusual, confirm your position with the Uttar Pradesh Startup Nodal Agency before submitting.

UP Startup Interest Subvention Scheme — 4% Off Loans Up to ₹2 Cr is open to startups at any stage. It is open to startups registered anywhere in India.

UP Startup Interest Subvention Scheme — 4% Off Loans Up to ₹2 Cr 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.

The core benefit is an interest subsidy at 4% per annum on a term loan taken from a scheduled bank or financial institution.

• How the amount is calculated: the lower of two figures — 4% of the loan amount, or the actual interest you paid. You get the smaller of the two, never both.
• Overall ceiling: the subvention is capped at ₹2 Crore over a period of three years.
• How it reaches you: the subsidy is paid directly to your lender every half-yearly cycle, which reduces your interest liability at source rather than reimbursing you later.
• Why it matters: lower interest outgo frees up working capital that can go back into core operations instead of servicing debt, improving overall financial stability.
• No dilution: as a government subsidy, this support does not come with equity, shares or board seats attached.

UP Startup Interest Subvention Scheme — 4% Off Loans Up to ₹2 Cr is offered by Government of Uttar Pradesh, a government body. As a government-backed subsidy, 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.

There is no pitch round, demo day or competitive shortlisting here. Once a complete application reaches the nodal agency that administers the UP Startup Policy, it moves through an administrative review.

• Document check — the agency confirms the submission is complete and the supporting papers are accurate.
• Eligibility verification — the startup's registration, the terms of its term loan and the interest already paid are examined against the policy conditions.
• Cross-verification with the lender — the details submitted are matched with the scheduled bank or financial institution that issued the loan.
• Approval — startups that demonstrate full adherence to the laid-out conditions are approved for the subvention.
• Disbursement — approved amounts flow to the lending institution on a half-yearly basis for the sanctioned duration.

Before you apply to UP Startup Interest Subvention Scheme — 4% Off Loans Up to ₹2 Cr, 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.

UP Startup Interest Subvention Scheme — 4% Off Loans Up to ₹2 Cr is best suited for startups in India seeking non-dilutive funding of ₹2Cr. If that describes your startup, review the eligibility criteria above before applying.