Innovation is the lifeline that helps a business to thrive. The government of India has launched an initiative for the MSMEs to promote innovation in the Indian MSME sector. Thus MSME innovation scheme came into existence!
Under the Ministry of MSME, there were three different schemes IPR, Incubation, and Design. All these three verticals were working independently with cross channels and inflows. Thus, the ministry combined all these schemes into the “MSME innovation scheme.” Ministry has also approved Rs. 1 crore for the commercialization of the ideas under this scheme. Therefore, MSMEs would be able to adopt newer technologies in their business.
Crucial Components of the MSME Innovation Scheme
There are three main components of the innovation scheme that will help MSMEs to grow in the future:
- Incubation of the startups: The primary objective of this component is to support the ideas of the MSMEs. It will help MSMEs to get validation of their ideas which they do not get by just getting into the market. So, their proof of concept can be the next revolution in the industry. Therefore, the MSME idea hackathon is an initiative for startups where they can showcase and pitch their plan. All the necessary support for the plants and machinery is also given to MSMEs.
- Design: The second component of this scheme is crucial for manufacturing businesses. So, to promote the new design strategies in the MSME sector, the Ministry of MSME has some sub-methodologies and schemes:
- Design project: To facilitate design strategies and give assistance, the Indian government started to support them through various means to promote the adoption of newer designs. The Indian government will appoint implementation agencies to which manufacturers can submit their design ideas. The ministry’s project monitoring and consulting agency (PMAC) will evaluate their designs — if approved the MSME will get the support.
- Student design project: Students studying in AICTE/UGC-approved institutes are eligible for this sub-scheme. So, either MSME can approach the students, or students can work with the startup for the design idea. Therefore, students get financial assistance, and 75 percent of the total project cost is given by the GOI.
- Intellectual property rights: Thus, to patent the design and raise awareness about intellectual property rights, MSMEs can get assistance to copyright their products. Therefore, under this scheme, all the MSMEs under the aegis of the Ministry of MSME qualify. So, under this program, financial and knowledge assistance is given to the MSMEs for patenting and registering their products.
Impact of MSME Innovation scheme on the startups
So, with all the initiatives working coherently, it will make the processes streamlined and effective, thus reducing the time for disbursement of the funds. There would be no reluctance from the businesses to show initiatives to innovate. Moreover, innovation will bring growth to startups and increase employment opportunities. So, to streamline your cash flow and balance your books to take advantage of these schemes, you can try out CredFlow, a unique SAAS platform helping businesses optimize their processes.
So, how would this scheme result in growth in the Indian MSME sector? Businesses can innovate without hesitation, leading to better business. As MSMEs made the backbone of the nation’s growth MSMEs directly impact the growth of the nation, so MSME innovative scheme is one of the most crucial steps that they undertook to uplift this sector.