Bank Loan Processing Fee Reimbursement Scheme

What is the Bank Loan Processing Fee Reimbursement Scheme?

The Bank Loan Processing Fee Reimbursement Scheme is a sub-component of the National SC-ST Hub (NSSH), a programme of the Ministry of Micro, Small and Medium Enterprises implemented by the National Small Industries Corporation (NSIC). The scheme is designed to reduce the up-front cost of borrowing for Scheduled Caste and Scheduled Tribe entrepreneurs, so that more SC/ST-owned enterprises take institutional credit instead of relying on informal finance.

According to the National SC-ST Hub, the scheme reimburses 80% of the bank loan processing charges paid by an eligible enterprise, subject to a cap of Rs 1,00,000 (excluding GST and other applicable taxes), whichever is lower. It covers both fund-based loans (such as term loans and cash credit) and non-fund-based facilities (such as bank guarantees and letters of credit).

Main features

• Reimbursement of 80% of the processing charge, capped at Rs 1,00,000.
• Applies to SC/ST-owned micro and small enterprises.
• Covers both fund-based and non-fund-based loans.
• Delivered directly to the enterprise's bank account after verification.

Why the scheme exists

The National SC-ST Hub was set up to help Scheduled Caste and Scheduled Tribe enterprises meet the quality and credit standards needed to participate in the mainstream economy, including the public-procurement target that requires central ministries and PSUs to source a share of their purchases from SC/ST-owned MSEs. A recurring barrier for a first-time SC/ST entrepreneur is the up-front cost of formal borrowing: banks levy a processing charge on every sanctioned loan, and on a large facility this can run into tens of thousands of rupees before a single rupee is disbursed. The Bank Loan Processing Fee Reimbursement Scheme removes that specific friction by returning most of the charge after the loan is taken, so the fee stops being a reason to avoid institutional credit. Because it covers both fund-based and non-fund-based facilities, it applies whether the enterprise takes a term loan, a cash-credit limit or a bank guarantee.

Who is eligible for the Bank Loan Processing Fee Reimbursement Scheme?

You can apply if:

• Your enterprise is a micro or small enterprise majority-owned by one or more SC/ST entrepreneurs.
• The enterprise has a valid Udyam Registration.
• The enterprise has taken a business loan from an eligible financial institution and paid a processing charge on it.

You cannot apply if:

• The enterprise is not majority-owned by SC/ST entrepreneurs. The scheme is a targeted SC/ST support and general enterprises are not eligible.
• The enterprise has no Udyam Registration.
• There is no documented processing charge paid (for example, the loan was not sanctioned or the fee was waived).

How much is reimbursed?

The scheme pays back 80% of the loan processing charges levied by the financial institution, up to a maximum of Rs 1,00,000, excluding GST and any other taxes. Whichever is lower — 80% of the actual charge or the Rs 1,00,000 ceiling; is the amount released. Because the reimbursement is calculated on the charge actually paid, keep the fee receipt or the bank's charge statement safe.

What documents are required?

How to apply for the Bank Loan Processing Fee Reimbursement Scheme

1. Ensure the enterprise has a valid Udyam Registration and that ownership by SC/ST entrepreneurs is documented with a caste certificate.
2. Take (or identify) the business loan from an eligible financial institution and obtain the processing-fee receipt or charge statement.
3. Register and log in on the National SC-ST Hub portal at scsthub.in.
4. Open the Bank Loan Processing Fee Reimbursement Scheme application and fill in the enterprise and loan details.
5. Upload the Udyam Registration, caste certificate, GST (if any), and the processing-fee receipt, and provide bank details for the transfer.
6. Submit the claim. NSIC verifies the documents and releases the reimbursed amount to the enterprise's bank account.

Help and contact

• National SC-ST Hub helpline: 1800-11-1954 (toll-free)
• Email: scsthub@nsic.co.in
• Portal: scsthub.in

The National SC-ST Hub delivers the reimbursement directly to the enterprise, so no agent is required. Verify the current reimbursement percentage and ceiling on scsthub.in before you apply, as NSSH parameters are periodically revised.