Vishwakarma Yuva Udyami Protsahan Yojana (VYUPY)
Video Explanation & Insights
Why the scheme exists
VYUPY has been introduced by the Rajasthan Government to make institutional credit affordable for young entrepreneurs — both those setting up a new unit and those expanding, diversifying, or modernising an existing one. It works through a combination of margin money assistance and interest subsidy routed via banks and financial institutions, so youth can access working capital and term loans at a meaningfully lower effective cost.
What the scheme pays for
| Component | Benefit |
|---|---|
| Interest Subsidy | Up to 8% per annum on loans up to ₹2 crore |
| Additional Interest Subsidy | 1% extra (over and above the base subsidy) on the loan slab above ₹1 crore and up to ₹2 crore, for special-category applicants |
| Margin Money Assistance | 25% of the loan amount, subject to a ceiling of ₹5 lakh |
Who can apply — frequently asked
Individual applicants must be between 18 and 45 years of age.
Yes. The entity must be duly registered under the applicable law, and at least 51% ownership must be held by individuals aged 18–45. A CA certificate is required to confirm this ownership structure.
On loans above ₹1 crore and up to ₹2 crore, the additional 1% applies to special-category applicants — as per the implementation guidelines, a person with disability (divyang) with 40% or more disability, or a unit located in a rural area (self-certification of rural location required). Media reporting on the cabinet approval also lists women, SC/ST entrepreneurs, and weavers/artisans within this special category — the exact composition should be confirmed against the applicant's specific slab and category before filing a claim. Where this slab is claimed, all members holding 51% or more ownership must belong to the applicable special category.
Only units falling within the Micro and Small Enterprise classification prescribed by the Government of India (at the time of the loan / interest-subsidy application) are eligible.
No. The applicant must not have been declared a wilful defaulter or defaulter by any State Government department or financial institution.
Yes. Where an applicant (or a family member) is already a director in a company that has availed scheme benefits and is also a director in a second company, the second company remains separately eligible for benefit under the scheme.
A manufacturing unit must show a minimum 25% increase in existing investment and a minimum 20% increase in production capacity (self-certified for cases up to ₹25 lakh; certified by a CA or Chartered Engineer above ₹25 lakh). A service-sector unit must show a minimum 25% increase in existing investment. Diversification / modernisation cases separately require a minimum 25% increase in investment.
Only where the vehicle is part of an eligible manufacturing / service project. Standalone commercial vehicle purchase is not eligible, and only one such vehicle is permitted per applicant.
How applications are processed
- 1Applications are filed online and routed to the General Manager, DICC of the concerned district.
- 2The Member Secretary verifies the application and supporting documents, then places eligible cases before the District Level Task Force Committee (DLTFC).
- 3Loans above ₹10 lakh are decided through a personal interview evaluating educational / technical qualification, inherited or prior experience, entrepreneurial aptitude, and market / project viability. Loans up to ₹10 lakh are decided on the strength of the application and documents alone.
- 4The DICC must place a received application before the DLTFC within 30 days of receipt.
- 5Any deficiency flagged on the portal must be rectified by the applicant within 30 days, failing which the application is auto-rejected.
- 6An applicant absent for interview on more than two occasions has the application rejected.
- 7An appeal against a DLTFC decision lies with the Commissioner, Industries & Commerce, within 30 days; that decision is final.
- 8Selected cases are forwarded to the lending institution via the portal for sanction and disbursement; disbursement follows the bank's normal appraisal norms, on a first-come-first-served basis subject to the annual budget allocated to each district.
District Level Task Force Committee (DLTFC)
Chaired by the General Manager, DICC, with representatives from the lead bank, a regional rural bank, a local government engineering college / polytechnic / ITI or MSME development institute (technical member), the District Employment Officer, the Women Empowerment Department, Rajeevika (Rajasthan Rural Livelihood Development Council), and RIICO. A quorum of at least 5 members, including one bank representative, is mandatory, and the committee must meet at least once a month.
Documents to keep ready
The implementation guidelines specify certain certifications tied to specific benefit slabs, but do not publish a single consolidated document list for the base application — that checklist is issued by each District Industries & Commerce Centre (DICC) on its online portal. Below is a two-part list: certifications the guidelines name directly, and the standard supporting documents any CA / CS would prepare for this class of MSME loan-cum-subsidy application. Confirm the final list against your district's portal before filing.
Named in the guidelines (mandatory where the slab applies)
| Document / Certificate | When required |
|---|---|
| CA certificate on shareholding / ownership | Institutional applicants (HUF, Society, Partnership, LLP, Company) — to certify 51%+ ownership is held by individuals aged 18–45 |
| Self-certification of production capacity increase | Expansion / modernisation cases where project cost is up to ₹25 lakh |
| CA / Chartered Engineer certificate of production capacity increase | Expansion / modernisation cases where project cost exceeds ₹25 lakh |
| Self-certificate of rural location | Claiming the additional 1% interest subsidy on the rural-unit ground |
| Disability certificate (40%+ disability) | Claiming the additional 1% interest subsidy on the divyang ground |
| Bank consent letter | Takeover / bank-switch cases, submitted with the application to the DICC |
| Quarterly KPI documents — employment records, tax paid, PF contributions, sale-purchase vouchers, electricity bills | Every quarter, to support each interest-subsidy claim (loans above ₹50 lakh additionally require a physical unit inspection before the first and last claim) |
Standard supporting documents (confirm with your DICC / lending bank)
- •Aadhaar card and a photo identity proof
- •Age proof (for the 18–45 eligibility check)
- •Caste / category certificate, where relevant to a special-category claim
- •Detailed Project Report (DPR) / project proposal, with cost of project and means of finance
- •Proof of business constitution — partnership deed, LLP agreement, MoA / AoA, or society / HUF registration, as applicable
- •PAN of the applicant / entity, and Udyam (MSME) registration
- •Address proof of the applicant and the proposed / existing unit premises (ownership deed or lease / rent agreement)
- •Bank account statement / passbook of the applicant
- •Quotations for machinery / equipment, wherever applicable
- •For expansion / diversification cases: existing investment and capacity records to establish the baseline against which the required increase is measured