Deen Dayal Upadhyaya Swavalamban Yojana (DDUSY)
40%
Front-Ended Capital Investment Subsidy
₹10L – ₹50L
Eligible Project Cost Band (Excl. Land & Building)
10% – 30%
Entrepreneur's Own Contribution
+5% p.a.
Additional Interest Subsidy for Women Entrepreneurs
Why the scheme exists, and how the money is structured
Notified vide No. PD(SPD)-29/DUSY/2017-18, Dept. of Finance, Planning & Investment, dated 17.09.2018 (Notification) and 26.10.2018 (Memo/Guidelines with approval of Hon'ble Chief Minister). Nodal: Planning & Investment Division; District Planning Officer as Entrepreneurship Development Officer.
The Government of Arunachal Pradesh continued the Deen Dayal Upadhyaya Swavalamban Yojana to encourage unemployed youth into entrepreneurship and to give them access to low-cost capital.
Three-Way Financing Structure
| Component | Share of Project Cost | Notes |
|---|---|---|
| Front-Ended Capital Investment Subsidy (State) | 40% | Provided to beneficiaries setting up small/medium enterprises with project cost of ₹10 Lakh to ₹50 Lakh |
| Bank Loan Component | 30% – 50% | Sanctioned and disbursed entirely at the discretion of the Scheduled Bank based on project bankability |
| Entrepreneur's Own Contribution | 10% – 30% | Preference given to applicants contributing a greater proportion |
Cost of land and building is excluded from project cost across all three components — the subsidy, loan and margin calculations are made only on the plant/machinery/working-asset cost of the project.
Women Entrepreneur Add-On
Women entrepreneurs are additionally eligible for a 5% annual interest subsidy, conditional on the entrepreneur's account not becoming a Non-Performing Asset (NPA).
The 40% capital subsidy, the 30–50% loan band and the 10–30% contribution band do not sum to a fixed 100% — they are independently stated ranges. In practice, structuring a specific case requires reconciling the three percentages against the actual project cost so that subsidy + loan + contribution together fund the full project; this arithmetic should be worked out and documented in the DPR/loan application for each applicant.
Sectors covered under the scheme
| Sector | Scope |
|---|---|
| Food Processing | Agriculture, horticulture and allied sectors — including packaging, cold chain, cold storage, milk processing |
| Eco-Tourism | Homestays and tour operators |
| Traditional Textile Weaving | Modernisation of traditional looms and purchase of new looms to start a new weaving unit |
| Small-Scale Manufacturing | Bamboo processing units, service centres, diagnostic centres |
Preference Criteria
- •Unemployed youth holding a Degree/Diploma in Tourism & Hospitality, ITI, or any other technical degree/diploma related to Fabrication, IT, Mobile Repairing, Motor Garage, etc.
- •Private doctors opening a medical clinic or diagnostic centre in the Border CD Blocks specifically — clinical fees for such clinics must be fixed at a reasonable rate.
- •Applicants contributing a greater proportion of the project cost (above the 10% floor) are given preference in selection.
The doctor/medical-clinic preference is explicitly scoped to Border CD Blocks only — it is not a general-eligibility category open statewide. Confirm the applicant's block falls within the notified Border CD Blocks list before advising on this preference route.
How an application moves from applicant to disbursed loan
District Level Screening Committee
| Member | Role |
|---|---|
| Deputy Commissioner | Chairman |
| ADC HQ | Member |
| District Industries Officer | Member |
| District Agricultural Officer | Member |
| District Horticulture Officer | Member |
| District Fishery Officer | Member |
| District Textile Officer | Member |
| District Tourism Officer | Member |
| District Lead Bank Manager | Member |
| District Planning Officer | Member Secretary |
The Committee meets at least once a month. The District Planning Officer (DPO) functions as the Entrepreneurship Development Officer for the district.
Application Steps
- 1Target allocation — Planning & Investment Division conveys a district-wise yearly target to Deputy Commissioners based on budgetary provision; the State Government reserves the right to review targets.
- 2Application submission — Prospective entrepreneur submits application in the prescribed format (Annexure 'A') with educational qualifications, plus a concept note in the standard format.
- 3Committee scrutiny — District Level Screening Committee scrutinizes proposals, involving Bank Managers; shortlisted candidates make a PPT presentation before the Committee.
- 4Forwarding to bank — Shortlisted proposal is forwarded to the concerned Scheduled Bank.
- 5Bank appraisal — Bank Manager confirms bankability and completeness of loan documents; project viability is determined solely by the Bank, which sanctions the loan.
- 6Subsidy transfer — Planning & Investment Division obtains A/A and E/S from competent authorities and transfers the subsidy amount to the bank — a mutually agreed buffer amount may be placed with the bank in advance.
- 7Loan conveyance — Once sanctioned, the Bank conveys the loan status to Planning & Investment Division monthly via the Lead Bank Manager.
The State Government's commitment is only a guarantee to release the front-ended subsidy — the actual loan sanction, disbursal and risk decision rest entirely with the Scheduled Bank. This is a materially different risk structure from a State-guaranteed loan scheme; the applicant bears full responsibility for availing the loan from the bank.
Review, collateral, misuse and default provisions
| Item | Provision |
|---|---|
| Review Requests | Any request for review may be re-submitted to the District Committee only for appropriate decision — loan-component decisions rest with the Bank based on project bankability |
| Collateral Security | Collateral security charged to the bank can be sold without restriction, as governed by the various Acts of the Government in force |
| Diversion / Misutilisation of Funds | Governed as per relevant existing Acts of the Government/Bank |
| Loan Default | State Government provides no guarantee for loan default — administered per the concerned bank's normal banking norms |
This guideline document was issued with the approval of the Hon'ble Chief Minister.
The lending product referenced as Annexure 2
Annexure 2 of the DDUSY guidelines is an SBI e-Circular (Sl. No. 825/2018-19, Circular No. NBG/SMEBU-SME SMART/25/2018-19, dated 25.09.2018) reviewing and modifying SME Smart Score — SBI's simplified-assessment lending product for loan requirements up to ₹50 Lakh, based on a Scoring Model. This is not itself a DDUSY-specific product, but is the type of bank product through which DDUSY loan components are typically routed at SBI branches.
Key Modifications (Annexure-I of the SBI Circular)
| Parameter | Existing (Pre-2018) | Modified (Per 25.09.2018 Circular) |
|---|---|---|
| Quantum of Finance | Trade & Services: ₹5–25 Lakh; Manufacturing: ₹5–50 Lakh | Manufacturing, Trade & Services (unified): Minimum >₹10 Lakh, Maximum <₹50 Lakh |
| Type of Facility | Cash Credit / Term Loan | Dropline Overdraft / Cash Credit / Term Loan, or a combination — Dropline OD's Drawing Power (DP) is the lower of Stock Statement DP or original Dropline level |
| Collateral Security | Per Bank's extant norms for Working Capital and Term Loan | Not insisted upon — loans covered under CGTMSE; if borrower declines to bear the CGTMSE guarantee fee/premium, collateral per Bank norms is required instead |
| Inspection | Quarterly | Half-yearly for standard accounts; monthly for SMA 0/1/2 accounts until the account turns standard |
| Assessment of Limit — Working Capital | Manufacturing: 20% of annual turnover; Trade & Services: 15% of annual turnover | Minimum 25% of annual projected turnover (30% for units with ≥25% sales through digital mode); Trading Units unchanged at minimum 15% |
| Assessment of Limit — Term Loan | 67% of project cost | 67% of project cost for all units (unchanged) |
| Repayment — Term Loan | Not more than 5 years, excluding moratorium up to 6 months | Not more than 7 years including moratorium not exceeding 6 months; annual review for all loans |
| CRA (Credit Risk Assessment) | Applicable for loans of ₹25 Lakh+ to manufacturing units | Not applicable for loans below ₹50 Lakh (Scoring Model is the eligibility criterion instead); CUE-Lite rating still required for all accounts |
Revised consolidated product features (Annexure-II of the SBI Circular)
| Parameter | Detail |
|---|---|
| Target Group | All MSME units — Proprietorship, Partnership, closely-held Public/Private Ltd Company — in Small & Medium industrial, trading and service sectors under SSI, C&I and SBF segments |
| Eligibility | Chief promoter/executive aged 18–65; minimum overall Scoring Model score of 60%, with minimum 50% under each sub-head (Personal Details, Business Details, Collateral Details — nil minimum where collateral is not applicable) |
| Purpose | Any credit requirement, including purchase of fixed assets |
| Quantum of Finance | Manufacturing, Trade & Services: minimum above ₹10 Lakh, maximum below ₹50 Lakh |
| Margin | Working Capital: 20%; Term Loan: 33% |
| Rate of Interest | Card Rate: One Year MCLR + 3.60% (per e-Circular CCO/CPPD-INT/123/2017-18, dated 01.03.2018) |
| Primary Security | Hypothecation of stocks, machinery and movable assets acquired out of the Bank's finance |
| Personal Guarantee | All Promoters/Directors/Partners; third-party guarantee if the offered property belongs to someone outside these categories |
| Documentation | Simplified SME documentation |
| Stock Statement | To be obtained monthly |
| Insurance | Comprehensive insurance on stocks/equipment and collateral properties, per Bank's clause |
| CIC Report | Both Commercial and Consumer CIC Reports must be satisfactory |
This SBI product circular is dated 25.09.2018 and reflects SBI's internal lending norms as of that date — treat all rate, margin and product-feature figures here as Indicative and bank-specific; verify current SME Smart Score terms directly with the SBI branch before quoting them to a DDUSY applicant, since bank card rates and product features are revised independently of the State scheme guidelines.
Notification history and administration
| Date | Milestone |
|---|---|
| 17/09/2018 | Notification issued vide No. PD(SPD)-29/DUSY/2017-18, Department of Finance, Planning & Investment (Planning & Investment Division), Itanagar — Government decides to continue DDUSY. |
| 25/09/2018 | SBI issues e-Circular (Sl. No. 825/2018-19) reviewing and modifying the SME Smart Score product features, referenced as Annexure 2 to the DDUSY guidelines. |
| 26/10/2018 | Memo No. PD(SPD)-29/DUSY/2017-18 issued under signature of the Development Commissioner (Finance, Planning & Investment), circulating the guidelines to the Governor's Secretariat, CM/DCM offices, all Ministers, Chief Secretary, all Principal Secretaries/Commissioners/Secretaries, all Deputy Commissioners, NABARD, SBI Lead Bank Manager (for circulation to all banks including RBI), and DIPR for gazette notification. Issued with the approval of the Hon'ble Chief Minister. |
Distribution list confirms multi-bank applicability — the Lead Bank Manager, SBI, Itanagar was addressed "for circulation amongst all banks including RBI," indicating DDUSY loans are not restricted to SBI alone, even though the only bank-product annexure provided is SBI-specific.
The source document does not specify a policy end date, sunset clause, or annual target figures (these are stated to be conveyed separately, district-wise, by the Planning & Investment Division based on yearly budgetary provision). Treat the scheme as continuing "until further orders" per its own notification language, and confirm current-year district targets directly with the Planning & Investment Division or the District Planning Officer before advising a client on availability.
Source: Guidelines for Deen Dayal Upadhyaya Swavalamban Yojana, Department of Finance, Planning & Investment (Planning & Investment Division), Government of Arunachal Pradesh, notified vide No. PD(SPD)-29/DUSY/2017-18 dated 17.09.2018, with guideline memo dated 26.10.2018; Annexure 2 sourced from State Bank of India e-Circular Sl. No. 825/2018-19 dated 25.09.2018. For advisory purposes only. Loan sanction, disbursal and bankability decisions rest solely with the Scheduled Bank; the State Government's role is limited to the front-ended subsidy guarantee.