MSME Innovative Scheme Benefits: MSME-Innovative scheme is one of the three components of the MSME Champions scheme (erstwhile Credit Linked Capital Subsidy-Technology Upgradation Scheme) other MSME-Sustainable (ZED) and MSME-Competitive (Lean) components. The Innovative scheme has three components viz., incubation, design, and intellectual property right. The scheme aims to foster innovation across the entire value chain, spanning from idea generation to the realization of innovative applications, by facilitating incubation and design interventions.
The objective is to provide the necessary infrastructure and support for the development of concepts, enhancing design competitiveness, protecting and commercializing intellectual creations within the MSME sector. It serves as a link between industry and academia leaders and innovators, promoting new product development and offering guidance.
Incubation
The Incubation component involves recognition of eligible institutions as Host Institute (HI) to act as business incubators, approval of ideas of incubatees submitted through HI, assistance for nurturing of ideas to HI and assistance towards capital support to HI for plant and machinery.
Technical colleges, universities, professional colleges/institutes, research and development institutes, NGOs engaged in incubation activities, MSME-DIs/Technology Centres, and any central/state government institution/organization have the opportunity to register as a HI and serve as a business incubator. Interested institutions can apply for HI registration via the Management Information System (MIS) portal on the DC MSME website.
The institutions once approved as HI can invite ideas from MSMEs and others and after due diligence can submit the selected ideas through the MIS portal of the DC MSME website. The ideas are evaluated in four stages. The HIs are provided with financial assistance up to Rs 15 lakh for every idea after its approval by the project monitoring and advisory committee (PMAC). 15 per cent of the total approved cost is borne by incubatees while the remaining 85 per cent is contributed by the MSME ministry.
Apart from financial support to nurture ideas, financial assistance up to Rs 1 crore is also offered to HI for buying and installing relevant plant and machines including hardware and software etc., in business incubator for research and development activities and common facilities for incubatees.
Design
The Design component has two parts viz., Design Project and Design Awareness Programme. The Project aims to facilitate MSMEs to develop new design strategies and or design related products through interventions and consultancy while the Awareness Programme focuses on creating general awareness and sensitization about the value and power of design for businesses through seminars, talks, workshops etc.
In order to apply for the Design component, MSMEs should have an Udyam certificate and be profitable preferably in at least one year out of their last three financial years. Moreover, the designer employed by the company should be a qualified industrial designer with relevant experience.
MSMEs are required to submit their design projects to the nominated implemented agencies (IAs) which are essentially MSME Development Institutes or Technology Centres. The projects evaluated by IAs are sent for approval by PMAC. Once approved, 75 per cent of the cost of projects belonging to micro units and 60 per cent of the cost of projects from small and medium units are contributed by the government up to a maximum of Rs 40 lakh and the remaining project cost is contributed by MSMEs.
The total project cost is provided in grant in three stages – 40 per cent at the strategy and concept stage, 30 per cent at the detail design stage and 30 per cent on successful completion of the prototype or product and final report submission.
Importantly, the IA has to ensure the completion of the project within a period of one year of getting the financial assistance and Utilisation Certificate is submitted. If an MSME leaves the project midway, a penalty is imposed as decided by the PMAC of the MSME ministry.
IPR
IPR component provides legal and intellectual property filing support including patents, trademarks, copyrights, designs, geographical indications, etc. The programme also provides IP advisory, consultation, patentability searches, technology gap analyses and IP commercialisation through establishment of Intellectual Property Facilitation Centres (IPFCs) across the country, according to the scheme’s details.
MSME development institutes, technology centres and any other organisations under the MSME ministry are eligible for registration as IPFCs. Moreover, government bodies or departments, MSME industry associations, societies, cooperatives, firms, trust and other profit and non-profit bodies, NGOs representing or working for MSMEs, research or technical and educational institutions, and universities with a track record of assisting MSMEs can also apply for IPFC registration.
The IPFC are recognised as IA for three years which can be renewed based on their performance after approval of PMAC.
Under the scheme, MSMEs can apply for reimbursement for the registration of patent, trademark, G.I. and design through an application on the portal of the scheme. The application is reviewed by the IPFC and sent to the MSME ministry for approval. Post ministry’s approval, the reimbursement is made to MSME.
Reimbursement up to Rs 5 lakh is allowed for foreign patents and Rs 1 lakh for domestic patents, Rs 2 lakh for GI registration, Rs 15,000 for design registration and Rs 10,000 for trademark as a one-time support.