SubsidyDepartment of Industries & Commerce, Government of TelanganaVerified 25 May 2026Official source stacks with TSFC Loan · ₹56L combined

Telangana MSME Policy 2020 — Interest Subsidy

The Telangana MSME Policy 2020 offers an interest subsidy for Micro and Small Enterprises (MSEs) on term loans for fixed capital investment under the Pavala Vaddi scheme. It covers both manufacturing and eligible service sectors, reimbursing interest charged above 3% up to 9%, for 5 years.

Maximum amount
₹15.0L
Typical payout
₹9.0L
Processing time
8–24 weeks
Application window
Open year-round

Check if your startup qualifies for Telangana MSME Policy 2020 — Interest Subsidy

Answer a few questions about your company and get a free, personalised eligibility report across all active government schemes — including TS MSME Interest.

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Eligibility criteria

Company type
Private Limited, LLP, Proprietorship, Partnership Firm
Stage
Early Stage (Revenue < ₹1Cr), Growth Stage (₹1Cr–₹25Cr), Scaling (₹25Cr+)
States
Telangana
Sectors
manufacturing, food_processing, textile, chemicals, engineering, agritech, pharma, other
Prerequisites
  • Udyam (MSME) registration required

Documents required

1
Udyam Registration Certificate
A valid certification showing the enterprise's registration under the Udyam system. Mandatory for all applicants.
Tip: Register on the Udyam portal with your enterprise details to obtain this certificate.
2
TS-iPASS Industrial Registration/Incentive Acknowledgement
Acknowledgement of registration or incentives under the TS-iPASS system. Mandatory for claim submission.
Tip: Complete registration on the TS-iPASS portal to receive this document.
3
Loan Sanction Letter
Official loan sanction letter from the financing bank or institution. Mandatory for application.
Tip: Request a copy of the sanction letter directly from your bank.
4
Bank-Interest Repayment Certificate
Bank-issued certificate detailing the principal and interest paid during the claim period. Mandatory for interest subsidy claim.
Tip: Coordinate with your bank to get this certificate in the prescribed format.
5
Land/Shed/Building Documents or Lease Deed
Certified copy of property documents or lease deed. Mandatory if applicable.
Tip: Ensure your property documents are up-to-date and certified.
6
Commercial Invoice and Ledger for Plant & Machinery
Invoices and ledger copies for purchased plant and machinery. Mandatory for fixed capital investment verification.
Tip: Keep a detailed record of all machinery purchases and expenses.
7
Valid Consent for Operation (CFO)
Consent for Operation from the Telangana State Pollution Control Board. Mandatory for operational compliance.
Tip: Apply for CFO through the Pollution Control Board's official procedures.
8
Certificate of Commencement of Commercial Production
Certificate proving the start of commercial production. Mandatory for subsidy eligibility.
Tip: Document the date and conditions when the production starts and obtain this certificate.
9
CA Certified Statement of Fixed Capital Investment
Statement certified by a Chartered Accountant verifying fixed capital investment. Mandatory for asset evaluation.
Tip: Engage a CA to audit and certify your investment records.
10
Power Allocation Letter and Latest Electricity Bills
Documents required if claiming combined power subsidies. Conditional based on claim types.
Tip: Collect your power allocation documents and maintain recent bill payments as proof.
11
Caste Certificate
Required if claiming enhanced benefits under T-PRIDE for SC/ST/PHC entrepreneurs. Conditional based on eligibility.
Tip: Obtain the caste certificate from local government authorities or via the official caste certificate portal.
12
Industrial Expansion Project Report
Report required only if claiming interest subsidy for a diversification/expansion unit. Conditional based on expansion.
Tip: Prepare a detailed report outlining the scope of the expansion or diversification plan.

How to apply for TS MSME Interest

1
Create a corporate user ID on the TS-iPASS Portal.Open portal
2
Log in and fill out the Common Application Form for incentives.
3
Select 'Reimbursement of Interest Subsidy under Pavala Vaddi Scheme' in the incentive module.Open portal
4
Scan and upload all mandatory certificates alongside the Bank Certificate.
5
Submit the claim and download the acknowledgment number to track processing through the TS-iPASS Dashboard.

Frequently asked questions

Who is eligible for TS MSME Interest?

TS MSME Interest is available to Private Limited, LLP, Proprietorship, Partnership Firm companies at the Early Stage (Revenue < ₹1Cr), Growth Stage (₹1Cr–₹25Cr), Scaling (₹25Cr+) stage, across Telangana. Udyam (MSME) registration is required.

How much funding does TS MSME Interest provide?

TS MSME Interest provides up to ₹15.0L. Most applicants receive around ₹9.0L.

How long does TS MSME Interest approval take?

The typical processing time from submission to disbursement is 8–24 weeks.

Is TS MSME Interest currently accepting applications?

Yes, TS MSME Interest is currently active and accepting applications. Application window: Open year-round.

Do I need Udyam registration for TS MSME Interest?

Yes, Udyam (MSME) registration is required. Register at udyamregistration.gov.in before applying.

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Information is based on publicly available scheme guidelines. Last verified 25 May 2026. Always verify with official sources before applying.