Mukhyamantri Laghu Udyog Protsahan Yojana (Chief Minister Small Industries Promotion Scheme)

What is the Chief Minister Small Industries Promotion Scheme?

Mukhyamantri Laghu Udyog Protsahan Yojana (MLUPY) is the Government of Rajasthan's flagship credit-support scheme for small enterprises, run by the Department of Industries and Commerce. The scheme's purpose is narrow and practical: make bank credit affordable for someone setting up a small unit in Rajasthan by paying a large part of the interest for the first five years.

MLUPY does not lend money. A bank or financial institution sanctions the loan on its own appraisal, and the state government reimburses 5 to 8 per cent of the interest for five years. The effect for a small borrower is substantial, on a Rs 20 lakh term loan carrying, say, 11 per cent interest, an 8 per cent state subsidy leaves the borrower carrying roughly 3 per cent.

According to the Department of Industries, the scheme covers manufacturing, service and trading enterprises, both for setting up a new unit and for expansion, diversification or modernisation of an existing one. Rajasthan budgeted over Rs 180 crore for the scheme in 2023-24 to route subsidised loans through banks and generate employment across districts.

How much subsidy does the scheme give?

Manufacturing and service enterprises

Trading enterprises

Key conditions on the benefit:

• The subsidy period is 5 years from the first disbursement.
• The subsidy is credited against the loan account, not paid as cash to the entrepreneur.
• The account must stay regular. A loan classified as a non-performing asset stops drawing subsidy.
• Trading enterprises are capped at Rs 1 crore, well below the Rs 10 crore ceiling available to manufacturing and service units.

Who is eligible for MLUPY?

You can apply if:

• You are 18 years of age or above on the date of application.
• The enterprise will be located in Rajasthan. The scheme funds units inside the state only.
• You are an individual entrepreneur, or a self-help group, society, partnership firm, LLP or company, as the scheme covers institutional applicants alongside individuals.
• The activity is in manufacturing, services or trade in the non-farm sector.
• You are setting up a new enterprise, or expanding, diversifying or modernising an existing one.

You cannot apply if:

• You are under 18 years of age.
• The project is located outside Rajasthan.
• You are an existing defaulter to a bank or financial institution; the bank will not sanction and the subsidy has nothing to attach to.
• You are already drawing an interest subsidy on the same loan under another state scheme such as BRUPY. A single loan cannot carry two state subsidies.
• The activity is agriculture itself. The scheme targets non-agricultural enterprise, though agro-processing units are enterprise activity and are treated as manufacturing.

There is no fixed educational qualification and no income ceiling published for the applicant. The real gate is the bank's credit appraisal of the project.

What documents are required?

Prepare the project report first. Banks reject far more MLUPY-linked applications for a weak or vague project report than for any documentation failure.

How to apply for MLUPY online

1. Create or log in to your SSO ID at sso.rajasthan.gov.in. Registration can be done with Jan Aadhaar, Bhamashah, Aadhaar or Google.
2. On the SSO dashboard, open the Citizen Apps list and select the MLUPY icon.
3. Click नया आवेदन / New Application and choose the enterprise type, manufacturing, service or trading, and whether it is a new unit or an expansion.
4. Fill in the applicant and enterprise details: name, address, constitution, proposed activity, project cost, loan amount required and expected employment.
5. Upload the project report and the supporting documents listed above.
6. Select the bank branch from which you want the loan, since the application is routed to that branch.
7. Submit the application and note the application number. Use it to track the case on the same portal.

What happens after submission

• Applications for loans up to Rs 10 lakh are forwarded directly to the selected bank branch.
• Applications for loans above Rs 10 lakh are first scrutinised by the District Level Task Force Committee (DLTFC) chaired at the district headquarters, and then sent to the bank.
• The bank appraises and sanctions the loan on its own terms.
• Once the loan is disbursed, the interest subsidy claim is processed by the District Industries Centre and credited to the loan account.

How to apply offline or with help

1. Visit the District Industries Centre (DIC) in your district with the project report and identity documents, and ask the industries extension officer for MLUPY guidance.
2. Use an e-Mitra kendra to complete the SSO registration and the online application if you cannot file it yourself.
3. Follow up directly with the bank branch you selected; the branch manager holds the file after forwarding.

The application itself is free. Only the notified e-Mitra service fee is payable for assisted filing.

How to check application status

1. Log in to sso.rajasthan.gov.in and reopen the MLUPY app.
2. Open the application tracking option and enter your application number.
3. The status shows the stage — submitted, at DLTFC, forwarded to bank, sanctioned, disbursed, or subsidy claim in process.
4. For a case stuck at the bank, contact the branch; for a case stuck at government level, contact the District Industries Centre.

Why MLUPY applications get rejected

• Weak project report. A report without realistic cost, market and repayment detail is the leading reason banks decline.
• Existing default or a poor credit record with any bank.
• Project located outside Rajasthan, which is outside the scheme entirely.
• Trading project above the Rs 1 crore ceiling, which does not fit the trading slab.
• Incomplete document upload, particularly missing firm constitution papers or proof of premises.
• Duplicate subsidy, the same loan already carrying a state interest subsidy under another scheme.
• Loan account turning irregular, which stops the subsidy midway even after sanction.

Most rejections are curable. Rework the project report with the DIC's help, clear the default, and reapply.

Key facts and dates

• MLUPY is implemented by the Department of Industries and Commerce, Government of Rajasthan.
• Rajasthan provided over Rs 180 crore in 2023-24 to route subsidised loans under the scheme.
• Applications are accepted all year, subject to the annual budget provision, so early filing in a financial year is an advantage.
• The official information page is industries.rajasthan.gov.in under Online Services, and filing is through sso.rajasthan.gov.in.

Help and grievance redressal

• District Industries Centre (DIC) of your district. The first and most effective point of contact for MLUPY.
• Department of Industries and Commerce, Rajasthan, industries.rajasthan.gov.in.
• Bank branch you selected in the application, for anything after forwarding.

No fee is payable to any consultant or agent to get an MLUPY application approved, and no officer will ask for your SSO password or OTP.