What is the purpose of Raw Material Assistance Scheme?

Raw Material Assistance Scheme is a government welfare initiative designed to support Infra, Industries through benefits related to Banking,Financial Services and Insurance, financial assistance, subsidies, social welfare, healthcare, education, or livelihood support.

Who can apply for Raw Material Assistance Scheme?

Eligibility for Raw Material Assistance Scheme may depend on factors such as income category, age, gender, occupation, state of residence, social category, and government-defined beneficiary criteria.

What benefits are offered under Raw Material Assistance Scheme?

Benefits under Raw Material Assistance Scheme may include financial assistance, subsidies, scholarships, insurance support, healthcare benefits, pension support, training assistance, or welfare services depending on the scheme guidelines.

Which department manages Raw Material Assistance Scheme?

Raw Material Assistance Scheme is managed by Ministry Of Micro, Small and Medium Enterprises and may be implemented through district offices, online portals, CSC centres, banks, or authorised government agencies.

Can users apply online for Raw Material Assistance Scheme?

Yes, eligible applicants may be able to apply online for Raw Material Assistance Scheme through official government portals, authorised service centres, or digital application systems depending on the implementation process.

Is Aadhaar mandatory for Raw Material Assistance Scheme?

Many government schemes may require Aadhaar verification, identity proof, or linked bank account details for beneficiary validation and direct benefit transfer processing.

Where can users apply for Raw Material Assistance Scheme?

Applications for Raw Material Assistance Scheme may be submitted through government departments, official scheme portals, CSC centres, district offices, welfare departments, or authorised service centres.

What documents may be required for Raw Material Assistance Scheme?

Applicants may need Aadhaar card, income certificate, residence proof, bank account details, caste certificate, photographs, educational records, or occupation-related documents depending on scheme eligibility requirements.

Is Raw Material Assistance Scheme a central government scheme?

Yes, Raw Material Assistance Scheme is a central government welfare initiative that may be implemented across multiple states through authorised departments and agencies.

Does Raw Material Assistance Scheme provide healthcare or insurance support?

Raw Material Assistance Scheme may provide healthcare assistance, insurance coverage, cashless treatment support, medical reimbursement, or hospital-related benefits depending on the scheme structure.

Can beneficiaries use Raw Material Assistance Scheme at government hospitals?

Eligible beneficiaries may be able to access services at empanelled hospitals, government healthcare facilities, or authorised healthcare providers depending on scheme participation rules.

Does Raw Material Assistance Scheme provide business loan or startup assistance?

Raw Material Assistance Scheme may support entrepreneurs, startups, self-employed individuals, MSMEs, or small businesses through financial assistance, subsidies, credit support, or training initiatives.

Is collateral required under Raw Material Assistance Scheme?

Collateral requirements may vary depending on the loan amount, implementing agency, financial institution, and government subsidy structure.

Can CSC centres help users apply for Raw Material Assistance Scheme?

Many government schemes may be accessible through nearby CSC centres, authorised digital service centres, or welfare facilitation offices.

How can users check the latest updates for Raw Material Assistance Scheme?

Users should verify official notifications, department announcements, application deadlines, and eligibility updates through authorised government portals or implementing agencies.

Can beneficiaries track application status for Raw Material Assistance Scheme?

Certain schemes may provide online application tracking, beneficiary verification systems, or status-check facilities through official portals.

Where can users get help for Raw Material Assistance Scheme in All India?

Users in All India may seek assistance through CSC centres, district welfare offices, government departments, agriculture offices, social welfare departments, or authorised facilitation centres.

Which nearby public services may help with Raw Material Assistance Scheme applications?

Depending on the scheme, users may require support from Aadhaar centres, CSC centres, banks, hospitals, post offices, or government welfare offices for document verification and application assistance.

Raw Material Assistance Scheme – eligibility, benefits & apply

Scheme profile

DBT (direct benefit transfer): No

Categories: Banking,Financial Services and Insurance

Sub-categories: Loan

Target beneficiaries: Industries

Tags: NSIC, MSME, Raw Material, Credit Support

Details

The scheme “Raw Material Assistance Scheme” was started by the National Small Industries Corporation (NSIC), Government of India Enterprise under the Ministry of Micro, Small and Medium Enterprises (MSME) to assist the Micro, Small and Medium Enterprises (MSMEs) in procuring the raw material(s). The Scheme aims to help MSMEs by way of financing the purchase of Raw Materials (Both indigenous & imported). This allows MSMEs to focus better on manufacturing quality products.

Benefits

1. Facilitating procurement of Raw Materials with credit support for up to 180 days. 2. MSMEs helped to avail Economics of Purchases like bulk purchases cash discounts etc. 3. Assistance against the security of Bank Guarantee-Rate of interest in respect of assistance availed on or after 01.02.2023: Particulars Effective Rate of Interest(% per Annum) Effective Rate of Interest(% per Annum) Normal Interest (Compounded on monthly rest) Upto 180 Days Micro Small &amp;amp; Medium (i) Units having valid SME 1 rating 8.759.25(ii) Units having valid SME 2 rating 9.259.75(iii) Other units9.7510.25 Note: The concessional rate of interest for the good-rated MSMEs as mentioned at Sl. No. (i) and (ii) in the table above shall be applicable only to those cases where the units make timely repayments of the Corporation’s dues. The units which have not re-paid its dues within the stipulated 180 days shall not be eligible for the concessional rate of interest. Such units shall be charged the rate of interest mentioned at Sl. No. (iii) above. 4. Additional rate of interest on delayed payment (beyond 180 days) over and above the normal rate of interest would be as under: In case any outstanding is more than 180 days1.25% per quarter Processing Fee: Processing Fee Micro Small &amp;amp; Medium On new sanctions1.0% per annum1.0% per annumOn Renewal0.5% per annum1.0% per annumNote: Security in the form of Bank Guarantee from Approved Banks

Facilitating procurement of Raw Materials with credit support for up to 180 days.
MSMEs helped to avail Economics of Purchases like bulk purchases, cash discounts, etc.
Assistance against the security of Bank Guarantee-Rate of interest in respect of assistance availed on or after 01.02.2023:
ParticularsEffective Rate of Interest(% per Annum)Effective Rate of Interest(% per Annum)Normal Interest (Compounded on monthly rest) Upto 180 DaysMicroSmall &amp; Medium(i) Units having valid SME 1 rating8.759.25(ii) Units having valid SME 2 rating9.259.75(iii) Other units9.7510.25*Note: The concessional rate of interest for the good-rated MSMEs, as mentioned at Sl. No. (i) and (ii) in the table above shall be applicable only to those cases, where the units make timely repayments of the Corporation’s dues. The units which have not re-paid its dues within the stipulated 180 days, shall not be eligible for the concessional rate of interest. Such units shall be charged the rate of interest mentioned at Sl. No. (iii) above.
Additional rate of interest on delayed payment (beyond 180 days), over and above the normal rate of interest, would be as under:
In case any outstanding is more than 180 days1.25% per quarter> Processing Fee:

Processing FeeMicroSmall &amp; MediumOn new sanctions1.0% per annum1.0% per annumOn Renewal0.5% per annum1.0% per annumNote: Security in the form of Bank Guarantee from Approved Banks.

Eligibility

Any Manufacturing/Service MSME having a Udyam Registration Certificate can apply for assistance under the Scheme.

Note: No trading activity is allowed under the scheme.

How useful is this scheme?

Public benefit analysis

A practical look at this scheme for citizens

AI-generated insights showing how useful, accessible, and practical this scheme may be — combining deterministic scoring rules with a public-policy LLM analyst.

5.5

/ 10

Public Benefit Score

Accessibility 5.0/10 Moderate

Rural usefulness 5.0/10 Moderate

Application complexity 5.0/10 Moderate

Financial impact 5.0/10 Moderate

Literacy barrier 4.0/10 Moderate

Women inclusivity 5.0/10 Moderate

Awareness 7.5/10 Good

Implementation reliability 7.0/10 Good

Bigger shape means a better fit for citizens

Accessibility5.0
Financial impact5.0
Rural utility5.0
Awareness7.5
Simplicity5.0
Inclusivity5.0

What problem does this scheme solve?

The Raw Material Assistance Scheme provides essential support to MSMEs in procuring raw materials, enhancing their manufacturing capabilities.

Key challenges addressed

Access to raw materials for MSMEs
Financial support for procurement

Most beneficial for

Manufacturing MSMEs
Service MSMEs with Udyam Registration

Likely challenges

Complex application process
Limited awareness among potential beneficiaries

Practical insights for citizens

The scheme is practical for MSMEs but faces challenges in rural implementation.

Rural challenges

Limited access to NSIC offices
Awareness of the scheme

Digital challenges

Low digital literacy
Limited online access

Implementation bottlenecks

Dependence on physical documentation
Inspection delays

Awareness challenges

Low outreach in rural areas
Limited information dissemination

Application analysis

Application mode: Offline office
Documents burden: Minimal, no specific documents listed
Verification complexity: Moderate, involves unit inspection
Office dependency: High, requires visit to NSIC branch
DBT dependency: No direct benefit transfer
CSC support: Limited
Estimated citizen effort: Moderate, requires filling forms and follow-up

Estimated beneficiary reach

Rural / urban reach Moderate
Gender reach Moderate
Occupation reach Industries

Benefit analysis

Benefit type: In Kind
Benefit frequency: One-time per procurement
Benefit practicality: High, as it directly supports raw material procurement
Financial meaningfulness: Moderate, as it helps in reducing procurement costs
Long-term impact: Positive, as it can enhance production capabilities of MSMEs

Plain-language guidance

The Raw Material Assistance Scheme helps small businesses get the raw materials they need to produce goods. It offers financial support to make purchasing easier.

Who should apply: Manufacturing and service MSMEs with Udyam Registration.
Who may struggle: First-time applicants and those unfamiliar with the application process.
Best application route: Apply directly at the nearest NSIC branch office.

This intelligence section is generated by an AI policy analyst combined with rule-based scoring. Scores and narrative are estimates derived from the publicly available scheme information shown on this page; actual experience may vary by state, district, and department. Always confirm details on the official portal before you apply.

Application Process

Offline

Application Process:

Step 01: The Entrepreneurs are required to apply for Raw Material Assistance only on the prescribed application forms.
Step 02: The applicants may download the application forms from the official website of NSIC. Also, the blank forms are available free of charge from the Branch offices.
Step 03: The duly filled application form along with the Application is to be submitted to the nearest Branch Office.

Post-Application Process:

Step 01: Preliminary appraisal and Unit inspection is carried out by NSIC.
Step 02: Sanction of Limit to the Unit.
Step 03: Signing of agreement between NSIC and Unit.
Step 04: Disbursement of assistance to the unit.

Clarifications

Additional points from the scheme information published on myScheme (not legal advice).

What is "Raw Material Assistance Scheme"?: In order to assist the Micro, Small and Medium Enterprises (MSMEs) in procuring the raw material(s), NSIC arranges to provide raw material as per specific needs and requirement of the unit(s).
Who can avail assistance under the Scheme?: Any Manufacturing/Service MSME having Udyam Registration Certificate can apply for the assistance under the Scheme.
Does NSIC facilitate procurement of raw materials for trading activities?: No trading activity allowed under Raw Materials Assistance Scheme.
Does NSIC facilitate MSMEs for raw material procurement against advance payment or on credit?: NSIC facilitates MSMEs in raw material procurement in both way i.e. against advance payment and also on credit, as per the requirement of MSMEs
How to apply for raw material assistance on credit under the Scheme?: Any MSME needs raw materials through NSIC may apply to any of the NSIC field offices for Raw Material Assistance in the prescribed application forms, which can be downloaded from NSIC’s website (www.nsic.co.in) or may be obtained from any of the field offices.
Where to submit application for raw material assistance?: The duly filled in application form along with prescribed documents can be submitted with the nearest branch office of NSIC. Details of NSIC offices are available on www.nsic.co.in.
How the limit is sanctioned for procurement of material on credit?: A limit is sanctioned keeping in view the raw materials requirements of the unit, financial position of the unit and available security of equivalent value in the form of bank guarantee.
Whether there is any ceiling of the limit to be sanctioned under the Scheme?: Maximum exposure to a single unit under the scheme is ₹1000 Lakhs in case of manufacturing unit and ₹600 lakhs in case of service unit. Maximum exposure to an Infrastructure unit will be ₹500 lakhs whether individual or group. The ceiling for maximum exposure to all associate/sister concerns or connected accounts belonging to a ‘GROUP’ is fixed at ₹2000 lakh for manufacturing units, ₹1500 Lakh for service units and ₹500 Lakh for Infrastructure unit.
What is the validity of the limits sanctioned under the Scheme?: One year. Thereafter, the limit can be renewed for one year provided conduct of the account was satisfactory during last year.
How does NSIC provide credit support to MSMEs for procurement of raw materials?: The unit has to submit proforma invoice/ original invoice/ material receipt note with the specific request to release the payment. The maximum assistance is provided upto 95% of the Bank Guarantee value.
Whether payment is released to the MSME?: No. NSIC releases the payment to the supplier as requested by the MSME.
What is the credit period of the assistance provided?: The credit is allowed for 180 days. However, it can further be extended on the request of MSME with the consent of the respective Zonal Head, provided the unit serves interest, the total outstanding is within the Bank Guarantee limit and the Bank Guarantee remains valid for an extended period.
What are the benefits to MSMEs under the Raw Material Assistance Scheme?: Materials facilitated under Bulk supply arrangements are provided at the bulk supplier’s rate by eliminating the middlemen. 2. Discounts received under bulk supplies arrangements are shared with MSMEs, enabling them to reduce the cost of purchase of materials. 3. Availability of raw material on credit and enabling MSMEs to execute the orders in hand
What is the rate of interest charged, if repayment is not made within 180 days?: 1.25% per quarter.

Official links

References

Official Website: https://www.nsic.co.in/Schemes/RawMaterialAgainstBG
Application Form: https://www.nsic.co.in/pdfs/forms/RMA-APP-14072023.PDF

Frequently asked questions

What is the purpose of Raw Material Assistance Scheme?: Raw Material Assistance Scheme is a government welfare initiative designed to support Infra, Industries through benefits related to Banking,Financial Services and Insurance, financial assistance, subsidies, social welfare, healthcare, education, or livelihood support.
Who can apply for Raw Material Assistance Scheme?: Eligibility for Raw Material Assistance Scheme may depend on factors such as income category, age, gender, occupation, state of residence, social category, and government-defined beneficiary criteria.
What benefits are offered under Raw Material Assistance Scheme?: Benefits under Raw Material Assistance Scheme may include financial assistance, subsidies, scholarships, insurance support, healthcare benefits, pension support, training assistance, or welfare services depending on the scheme guidelines.
Which department manages Raw Material Assistance Scheme?: Raw Material Assistance Scheme is managed by Ministry Of Micro, Small and Medium Enterprises and may be implemented through district offices, online portals, CSC centres, banks, or authorised government agencies.
Can users apply online for Raw Material Assistance Scheme?: Yes, eligible applicants may be able to apply online for Raw Material Assistance Scheme through official government portals, authorised service centres, or digital application systems depending on the implementation process.
Is Aadhaar mandatory for Raw Material Assistance Scheme?: Many government schemes may require Aadhaar verification, identity proof, or linked bank account details for beneficiary validation and direct benefit transfer processing.
Where can users apply for Raw Material Assistance Scheme?: Applications for Raw Material Assistance Scheme may be submitted through government departments, official scheme portals, CSC centres, district offices, welfare departments, or authorised service centres.
What documents may be required for Raw Material Assistance Scheme?: Applicants may need Aadhaar card, income certificate, residence proof, bank account details, caste certificate, photographs, educational records, or occupation-related documents depending on scheme eligibility requirements.
Is Raw Material Assistance Scheme a central government scheme?: Yes, Raw Material Assistance Scheme is a central government welfare initiative that may be implemented across multiple states through authorised departments and agencies.
Does Raw Material Assistance Scheme provide healthcare or insurance support?: Raw Material Assistance Scheme may provide healthcare assistance, insurance coverage, cashless treatment support, medical reimbursement, or hospital-related benefits depending on the scheme structure.
Can beneficiaries use Raw Material Assistance Scheme at government hospitals?: Eligible beneficiaries may be able to access services at empanelled hospitals, government healthcare facilities, or authorised healthcare providers depending on scheme participation rules.
Does Raw Material Assistance Scheme provide business loan or startup assistance?: Raw Material Assistance Scheme may support entrepreneurs, startups, self-employed individuals, MSMEs, or small businesses through financial assistance, subsidies, credit support, or training initiatives.
Is collateral required under Raw Material Assistance Scheme?: Collateral requirements may vary depending on the loan amount, implementing agency, financial institution, and government subsidy structure.
Can CSC centres help users apply for Raw Material Assistance Scheme?: Many government schemes may be accessible through nearby CSC centres, authorised digital service centres, or welfare facilitation offices.
How can users check the latest updates for Raw Material Assistance Scheme?: Users should verify official notifications, department announcements, application deadlines, and eligibility updates through authorised government portals or implementing agencies.
Can beneficiaries track application status for Raw Material Assistance Scheme?: Certain schemes may provide online application tracking, beneficiary verification systems, or status-check facilities through official portals.
Where can users get help for Raw Material Assistance Scheme in All India?: Users in All India may seek assistance through CSC centres, district welfare offices, government departments, agriculture offices, social welfare departments, or authorised facilitation centres.
Which nearby public services may help with Raw Material Assistance Scheme applications?: Depending on the scheme, users may require support from Aadhaar centres, CSC centres, banks, hospitals, post offices, or government welfare offices for document verification and application assistance.