Coir Udyami Yojana

The Coir Udyami Yojana helps you start a coir-based business with financial support from the government. This credit-linked subsidy scheme allows you to set up a coir unit with a project cost of up to ₹10 Lakhs. Managed by the Coir Board under the Ministry of Micro, Small and Medium Enterprises, it provides easier access to bank loans through recognised financial institutions. The scheme encourages entrepreneurship and supports the growth of India’s traditional coir industry by making business ownership more achievable and sustainable.

The Coir Udyami Yojana scheme provides strong financial and developmental support to help you start or expand a coir-based enterprise with long-term sustainability. Here is a detailed overview of its main features and benefits:

Encourages Coir Entrepreneurship

Promotes the creation of micro and small-scale coir units across India to boost rural industry and self-employment opportunities.

Credit-linked Financial Assistance

Combines government subsidy and bank loan support, ensuring affordable access to funds for new entrepreneurs.

Project Cost Coverage

Supports projects up to ₹10 Lakhs, making it easier to establish a viable coir manufacturing setup.

Low Beneficiary Contribution

Requires you to contribute only 5% of the total project cost, reducing financial strain at the startup stage.

Government Subsidy Support

Provides a 40% subsidy on the project cost, significantly lowering repayment pressure and promoting financial stability.

Easy Bank Loan Facility

Offers bank loans up to 55% of the project cost on concessional terms, simplifying access to capital.

Collateral-free Credit

Ensures loans are available without the need for collateral under the CGTMSE guarantee scheme, helping first-time entrepreneurs.

Flexible Repayment Tenure

Allows repayment over a maximum period of 7 years, making financial planning easier and more manageable.

Eligible Expenditure Coverage

Funds can be used for capital investment such as land development, construction, and purchase of coir machinery and equipment.

Technology and Skill Development

Encourages adoption of modern coir processing machinery and provides skill training through Coir Board programmes to enhance productivity.

Employment Generation

Creates sustainable job opportunities in rural and semi-urban regions, strengthening local economies.

Women and Inclusive Growth

Promotes women’s participation in coir production and supports inclusive entrepreneurship at the grassroots level.

Market and Export Support

Offers assistance for participation in trade fairs and export promotions, helping coir units expand their market reach.

Eco-friendly Production Practices

Encourages the use of renewable materials like coconut husk to promote sustainable and environmentally responsible manufacturing.

The Coir Udyami Yojana supports individuals and groups who wish to start coir-based businesses across India. Here are the key eligibility conditions you must meet to qualify:

• You must be an Indian citizen aged 18 years or above

• There is no income limit to apply for financial assistance under the scheme

• Your project must involve the production of coir fibre, yarn, or coir-based products

• You can apply as an individual, company, self-help group (SHG), NGO, registered society, production co-operative, joint liability group, or charitable trust

• You cannot apply if you have already received a government subsidy for the same purpose under another central or state scheme

• Applicants from SC, ST, or OBC categories must provide a valid caste or community certificate issued by a competent authority

• Institutional applicants must submit a certified copy of their organisation’s bylaws with the application

• The project cost must include capital expenses such as land, building, and machinery

• You may include one cycle of working capital, up to 25% of the total project cost, but it will not be eligible for subsidy

• If you already own a work shed, only the cost of new machinery will be considered under the project

• The scheme gives priority to applicants from SC/ST communities, women, youth, and entrepreneurs from the North Eastern Region

Here are the key conditions that define which projects or expenses are not eligible for assistance under the scheme:

• Units that have already received a government subsidy for the same purpose under any central or state scheme cannot apply again

• Working capital is not eligible for subsidy under the scheme, even though it can be included in the project cost

• Applications showing inflated costs for machinery, buildings, or other project components to claim higher subsidies will be rejected

• The sanctioning committee reserves the right to revise or reduce the project cost if overpricing is detected during evaluation

Here are the simple steps you need to follow to apply for financial assistance under the Coir Udyami Yojana:

1. Fill out the prescribed application form and attach all the required documents

2. Submit the completed application to the nearest Coir Board field office

3. Attend the mandatory five-day Entrepreneurship Development Programme (EDP) before or after submission but before bank recommendation

4. The Coir Board reviews your application and forwards it to the Regional Level Selection Committee for evaluation

5. The committee examines the proposal and recommends eligible cases to the bank

6. Upon bank approval, deposit your 5% beneficiary contribution within 30 days

7. The Coir Board transfers the 40% government subsidy to the approved bank

8. The bank releases the term loan amount within 30 days of receiving the subsidy

9. Complete the project setup within six months from the date of loan sanction

10. The Coir Board and the bank jointly conduct a physical inspection before the final subsidy adjustment

The Coir Udyami Yojana helps entrepreneurs start and grow coir-based businesses through financial aid, training, and subsidies. It reduces startup costs, encourages eco-friendly production, and boosts rural employment while preserving India’s traditional coir industry. You can explore reliable business loan options on Bajaj Markets and access funds quickly with flexible financing offers.