Capital Subsidy vs Interest Subsidy: Can You Get Both?
| Capital Subsidy | Interest Subsidy | |
|---|---|---|
| What it rewards | The investment itself (plant & machinery) | Timely repayment of a loan |
| Payment pattern | One-time, in instalments | Recurring, claimed annually |
| Rate | 10โ25% of investment, by category/zone | Up to 50% of interest paid |
| Duration | N/A โ single claim | Up to 5 years |
| Who qualifies | Micro, Small, Medium (rates vary) | Micro units specifically |
Can You Combine Them?
These are different provisions of the same UP MSME policy addressing different things โ capital subsidy rewards the investment you made, interest subsidy rewards you for servicing the loan that funded it. They're not the kind of scheme where taking one disqualifies the other the way margin-money schemes do. That said, always confirm the current combinability rule with your DIC before assuming both apply โ policy provisions can specify exceptions.
If I already got capital subsidy on my machinery, can I still claim interest subsidy on the loan?
In principle yes, since they address different things โ but confirm with your DIC, since eligibility also depends on being a Micro unit with a standard loan account.
Is Medium enterprise eligible for interest subsidy too?
The interest subsidy scheme is specifically framed for Micro units in this site's research โ Medium units should confirm their own eligibility with the DIC.
Want help claiming both subsidies?
ClaimDesk (a NorthStar Advisors brand) handles the paperwork end-to-end. The first conversation is completely free.
MSMEUP.com is independent information & tools โ free, and not run by any consultancy. ClaimDesk is a separate, private consultancy (a NorthStar Advisors brand) for those who want professional filing help; its fee is for that service, not a government charge, and using it is entirely optional โ MSMEUP's guides and tools work the same with or without it.
Official portal: msme.up.gov.in Last reviewed: Aug 2026
This page summarizes publicly available scheme information. For the current official notification, application form and exact eligibility conditions, always confirm on the portal above before applying or filing a claim.