Coir Udyami Yojana
40% subsidy + 55% bank credit · coir unit up to ₹10 lakh · rural India
Anyone above 18 years — individual, SHG, NGO, or company — can set up a coir production unit with a 40% government subsidy on project costs up to ₹10 lakh. You contribute only 5% and a bank finances the rest. Apply at your nearest Coir Board Field Office and complete the mandatory 5-day Entrepreneurship Development Programme (EDP) before the bank loan is recommended.
About This Scheme
Anyone above 18 years — individual, SHG, NGO, or company — can set up a coir production unit with a 40% government subsidy on project costs up to ₹10 lakh. You contribute only 5% and a bank finances the rest. Apply at your nearest Coir Board Field Office and complete the mandatory 5-day Entrepreneurship Development Programme (EDP) before the bank loan is recommended.
Full official description
Coir Udyami Yojana is a credit-linked subsidy scheme for setting up coir units with a project cost up to ₹10,00,000/- plus one cycle of working capital, which shall not exceed 25% of the project cost. Working capital will not be considered for subsidy. Coir Udyami Yojana is a Central Sector Scheme to be administered by the Ministry of Micro, Small and Medium Enterprises. The Scheme will be implemented by the Coir Board a statutory organization under the Ministry of MSME, as the Nodal Agency at the national level.
Financial Institutions providing loan under CUY
- All the Scheduled Commercial Banks listed in the 2nd schedule of the RBI Act
- All Regional Rural Banks
- Co-operative Banks that are Member Lending Institutions (MLIs) of the Credit Guarantee Trust Fund for MSME, as well as through SC/ST/OBC Finance and Development Corporations.
Benefits
- 40% government subsidy on project cost (up to ₹10 lakh)
- Beneficiary contributes only 5% of project cost; bank provides 55% as term loan
- Working capital up to 25% of project cost can be added to the loan (not subsidized)
- Bank disburses full project amount once 5% beneficiary contribution is deposited
💡 Why Startups Should Care
With only 5% own contribution required and 40% as non-repayable subsidy, this scheme makes entering coir manufacturing highly capital-efficient — you're financing a ₹10 lakh unit with just ₹50,000 of your own money.
Who Can Apply (Eligibility)
- Must be an Indian citizen above 18 years of age
- No income ceiling — open to all income levels
- Eligible applicant types: individual, company, SHG, NGO, registered society, cooperative, JLG, or charitable trust
- Project must involve coir fibre, yarn, or product manufacturing
- Must not have already received a government subsidy from another scheme for the same purpose
- Special focus on SC/ST applicants, women, and those from the North Eastern Region (NER)
Exclusions
- Units that have already availed Government subsidy under any other Central/State scheme for the same purpose are not eligible
How to Apply
- Fill out the prescribed application form for the scheme.
- Attach all required documents including title deed of the proposed unit site.
- Apply to the nearest Field Office of the Coir Board.
- The Board reviews and forwards the sanctioned application to the linked bank for credit.
- On disbursement, the subsidy portion is credited alongside the bank loan.
Frequently Asked Questions
Is there any age limit to apply under Coir Udyami Yojana?
The applicant must be at least 18 years of age to be eligible for the scheme.
Who monitors the implementation of the scheme?
The Coir Board, its regional offices, and the concerned bank jointly monitor implementation and verify the physical setup of units.
What are the financial benefits under this scheme?
- Beneficiary contribution: 5% of the project cost- Bank credit: 55%- Subsidy: 40% (on project cost excluding working capital)- Working capital: Not eligible for subsidy and must not exceed 25% of the project cost.
What is the role of the Regional Level Selection Committee?
The committee evaluates applications and recommends eligible cases to banks for further processing.
What documents are required for applying?
Documents include a project report, ID proof, title deed, machinery invoice, DIC certificate, and others as listed in the guidelines.
Can I apply if I already received a subsidy from another government scheme?
No, beneficiaries who have availed similar subsidies under any Central or State Government schemes are not eligible.
Can I sell or transfer the unit or machinery after receiving the subsidy?
No, machinery and assets created under the scheme cannot be sold or transferred without permission from the Coir Board.
Are there any preferences for SC/ST or North East Region applicants?
Yes, the scheme encourages participation from SC/ST candidates and those from the North Eastern Region.
What are Mode of Disbursement ?
- The bank releases the term loan after receiving the Margin Money (subsidy) from the Coir Board.
- Subsidy kept as Term Deposit Receipt (TDR) for 2 years.
- After 2 years, the subsidy is credited to the beneficiary’s loan account.
Is the subsidy given before or after setting up the unit?
The subsidy is released after loan disbursement and is held as a Term Deposit Receipt for 2 years.
Ready to apply?
Visit the official government portal to apply for this scheme.
Apply on myScheme.gov.inDocuments Required
- Prescribed application form for scheme assistance
- Copy of title deed of the property where the unit will be set up
- Proof of Coir Industry experience or intent