Entrepreneur Support Scheme (ESS)

What is the Entrepreneur Support Scheme?

Entrepreneur Support Scheme (ESS) is the flagship capital subsidy of the Directorate of Industries and Commerce under the Kerala Industries Department. ESS pays a share of the fixed capital investment made by a micro, small or medium manufacturing enterprise set up in Kerala, so that a first-time promoter is not carrying the entire cost of land development, building, plant and machinery alone.

According to the Directorate of Industries and Commerce, ESS provides "financial assistance to Micro, Small and Medium Enterprises engaged in manufacturing activities", with subsidies ranging from 15 per cent to 45 per cent depending on the category of the investor, the sector and the district of investment. The scheme is delivered entirely online through ess.industry.kerala.gov.in and is verified on the ground by the District Industries Centre (DIC) in each district.

Key features

• Subsidy is on fixed capital investment, not on working capital or turnover.
• Three separate stages of assistance; start-up support, investment support and technology support.
• Udyam registration is compulsory for every applicant.
• 30 per cent of the earmarked assistance is reserved for micro enterprises.
• The unit must stay working for five years from commencement of production.

Who is eligible for the Entrepreneur Support Scheme?

Your unit can claim ESS if:

• It is a micro, small or medium enterprise engaged in manufacturing and is located in Kerala.
• It holds a valid Udyam registration.
• It has made a fixed capital investment in land development, building, plant or machinery that can be evidenced with invoices and payment proof.
• It is willing to continue operations for five years from the date of commencement of commercial production.
• It applies within the prescribed time window for the stage being claimed.

Your unit is not eligible if:

• It is a service enterprise. Services are on the ESS negative list.
• It falls in any other negative list activity, photo studios, colour processing centres, tailoring units other than readymade garment manufacturing, breweries and distilleries, saw mills, soap-grade sodium silicate, asbestos processing, metal crushers, granite manufacturing, steel re-rolling mills, iron ingot manufacturing, calcium carbide, cement manufacturing other than from fly ash, potassium chlorate, and power-intensive units.
• It has no Udyam registration.
• It applies after the one-year window from commencement of production for investment support, or after six months for technology support.

Individuals cannot claim ESS as a personal benefit. ESS is an enterprise incentive: the applicant is the manufacturing unit, and the subsidy is paid into the enterprise's own bank account.

How much subsidy does ESS pay?

Total assistance to a single enterprise is capped at Rs 40 lakh, however the individual slabs add up. The priority sectors that attract the extra 10 per cent include rubber-based industries, agro-based and food processing, readymade garments, non-conventional energy equipment manufacture, biotechnology, 100 per cent export-oriented units, biodegradable plastics, plastic waste recycling, bio-fertilisers, and pharmaceutical and healthcare product manufacture.

What are the three stages of ESS assistance?

1. Start-up support. Start-up support is given to an enterprise that has a sanctioned term loan but has not yet begun commercial production. Assistance at this stage is limited to 50 per cent of the total eligible support, capped at Rs 3 lakh, released on sanction of the loan. The balance of the eligible amount can be claimed later, once production actually starts.

2. Investment support. Investment support is the main stage and is claimed after commercial production commences. A bank loan is not required at this stage, a unit financed entirely from own funds can still claim. The application must be filed within one year from the date of commencement of production. Expansion, diversification and modernisation of an existing unit are also supported under this stage.

3. Technology support. Technology support is given after production, where the unit has adopted new technology acquired from an authorised institution. The unit must apply within six months from the date of commencement after installing the new technology.

What documents are required for ESS?

How to apply for the Entrepreneur Support Scheme

1. Get Udyam registration for the manufacturing unit first. Every ESS stage checks this, and an application without it will not move forward.
2. Register on the ESS portal at ess.industry.kerala.gov.in and create a login for the enterprise.
3. Choose the stage you are claiming — start-up support, investment support, or technology support, and fill the corresponding form.
4. Upload the supporting documents, including invoices and payment proof for the fixed capital investment, the Udyam certificate, category proof if you are claiming the 25 per cent rate, and the commencement of production certificate.
5. Pay the application fee of Rs 1,100 per unit through the portal and submit.
6. Attend the site inspection by the District Industries Centre. A DIC officer physically verifies the machinery, the building and the working status of the unit against the claim.
7. Track the sanction. Start-up support is sanctioned by the General Manager, DIC. Investment support goes to the District Level Committee chaired by the District Collector, whose members include the Lead District Manager, a Finance Department representative, the KFC District Manager, a KSSIA representative, and the GM-DIC as Member Secretary.

Offline help is available at the District Industries Centre in your district and at the taluk industries offices, but the application itself is filed online.

How to check your ESS application status

1. Log in to ess.industry.kerala.gov.in with the enterprise credentials used at the time of application.
2. Open the application record to see the current stage, DIC scrutiny, site inspection, District Level Committee, or sanction.
3. For anything stuck at scrutiny or inspection, contact the General Manager of your District Industries Centre, who owns that stage of the file.
4. For escalation, contact the Directorate of Industries and Commerce, Vikas Bhavan, Thiruvananthapuram, on 0471-2302722.

Why ESS applications get rejected

• Applied too late. Investment support filed beyond one year from commencement of production, or technology support beyond six months, is time-barred.
• Activity on the negative list, most often a service unit applying for a manufacturing subsidy.
• No Udyam registration, or a Udyam record whose activity code does not match what the unit actually does.
• Fixed capital investment not evidenced. Cash purchases without invoices and bank payment trails do not survive DIC verification.
• Unit not working at the time of inspection. ESS requires the unit to remain in continuous operation for five years, and a shut unit at inspection stage will not be sanctioned.
• Category claim without proof, for example a 25 per cent claim on the young entrepreneur slab without age proof.

An applicant aggrieved by a District Level Committee decision can appeal to the State Level Committee chaired by the Director of Industries and Commerce, whose members include representatives of the Finance Department, the Managing Directors of KSIDC and KFC, the Director of MSME and the KSSIA state representative.

Help and contact for ESS

• Directorate of Industries and Commerce, Vikas Bhavan, Thiruvananthapuram to 0471-2302722, email industriesdirectorate@gmail.com.
• District Industries Centre in your district, for scrutiny, inspection and start-up support sanction.
• ess.industry.kerala.gov.in for the application, fee payment and status.

No agent or consultant is needed to obtain an ESS sanction, and the only payment in the process is the Rs 1,100 application fee paid on the government portal.