10 Government Schemes for Small Business in India You Must Know (2026)

Quick take

The Indian government runs dozens of schemes specifically for MSMEs and small businesses — from collateral-free loans up to ₹10 lakh (Mudra) to 35% project cost subsidies (PMEGP). Most require Udyam registration. OpenBiz helps you identify which schemes you qualify for and handles the application process.

The government spends thousands of crores annually on schemes for small businesses. Most owners either don’t know they exist or find the process too confusing. This guide breaks down the 10 most impactful schemes with clear eligibility, benefits, and how to apply.

Scheme 1

💰 Pradhan Mantri Mudra Yojana (PMMY)

Collateral-free loans: Shishu (up to ₹50K), Kishore (up to ₹5L), Tarun (up to ₹10L). For any Indian citizen with a non-farm business. Apply at any bank. OpenBiz prepares your loan application and project report professionally.

Read our detailed Mudra Loan guide →

Scheme 2

🛡️ Credit Guarantee Fund Trust (CGTMSE)

Government guarantee enabling collateral-free loans up to ₹5 crore. For micro and small enterprises. Banks are more willing to lend because the government bears the risk. Apply at any bank and request CGTMSE coverage. OpenBiz helps you find the right bank and prepares your documentation.

Scheme 3

🚀 Stand-Up India

Loans ₹10 lakh to ₹1 crore for SC/ST and women entrepreneurs starting new enterprises. Covers up to 75% of project cost with 7-year repayment. Apply via standupmitra.in or any scheduled bank.

Scheme 4

🔨 PM Vishwakarma Scheme

For artisans in 18 trades (carpenters, blacksmiths, goldsmiths, tailors, etc.). Get a certificate, skill training, ₹15K toolkit incentive, and collateral-free loans at just 5% interest (₹1L + ₹2L). Apply at pmvishwakarma.gov.in.

Scheme 5

🌱 Startup India Seed Fund (SISFS)

Up to ₹20 lakh grant (non-repayable) for proof of concept, plus up to ₹50 lakh debt for market entry. For DPIIT-recognised startups under 2 years old. Apply through empanelled incubators at seedfund.startupindia.gov.in.

Get DPIIT recognition first with OpenBiz →

Scheme 6

🏢 PMEGP (Employment Generation Programme)

15-35% subsidy on project cost for new micro enterprises. Manufacturing up to ₹50L, services up to ₹20L. Higher subsidy for rural areas and special categories. Apply at kviconline.gov.in.

Schemes 7-10

More schemes worth knowing

✅ TUFS — Up to 5% interest reimbursement on technology upgradation loans for manufacturing MSMEs
✅ Market Access Initiative (MAI) — ₹30-50 lakh funding for export-oriented MSMEs attending trade fairs
✅ MSME LEAN Scheme — Government reimburses 90% of lean manufacturing implementation cost
✅ Udyam Assist Platform — Formal registration for informal micro enterprises, enabling priority lending and procurement access

How to maximise your benefits

1️⃣ Get MSME Registration first — the gateway to most schemes
2️⃣ Get GST registered if above threshold — unlocks interstate selling
3️⃣ Get DPIIT recognised for Seed Fund and tax benefits
4️⃣ Apply for Mudra or CGTMSE-backed loan based on your needs
5️⃣ Use OpenBiz — our AI analyses your business and matches you with the right schemes, then experts handle the applications

Frequently asked questions

Can I apply for multiple schemes?

Depends on the scheme. Some (PMEGP) require no prior benefits. Others (CGTMSE) can be combined. OpenBiz helps you identify which schemes stack for maximum benefit.

Are service businesses eligible?

Yes. The distinction between manufacturing and service enterprises has been removed. Most schemes cover both.

How long to receive benefits?

Loan-based schemes: 2-4 weeks. Subsidy-based schemes (PMEGP, TUFS): 2-6 months after approval.

Stop leaving money on the table

Every day you delay is a day of benefits you’re not using. OpenBiz helps you figure out exactly which schemes you qualify for and handles the application process end to end. Our AI analyses your business profile and matches you with the right schemes.

Check your scheme eligibility →

Regional language keywords

Last updated: March 2026. Scheme details verified against official government sources.