46 XX | Enlightener Series | B. Central Government Schemes | B.17 SIDBI's End to End Energy Efficiency (4E) Scheme

Disclaimer….before you read ahead!

The information contained herein is of a general nature and for information purposes only, with the intent of raising awareness around various resources, schemes etc. available for women entrepreneurs in India. It is not intended to address the circumstances of any particular individual or entity. It does not purport to be all-inclusive or necessarily contain all the information that may be relevant for the reader, and may be subject to updating, revision or amendment. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to remain accurate in the future. The reader, therefore, is required to exercise their discretion; and not act on such information without appropriate professional advice after a thorough examination of the particular situation.

Furthermore, we are not a lender and are not authorized by the Reserve Bank of India to act as one. By disseminating the information contained herein, we are not soliciting any borrower or customers for the company or organization mentioned herein nor do we intend to syndicate any capital for the reader of this article.

About this scheme…

End to End Energy Efficiency (4E) Scheme, a sustainable finance scheme, was launched by Small Industries Developmental Bank of India (SIDBI) on 5 June 2014 as an intervention on World Environment Day to combat climate change and upscale interventions in the area of sustainable development. The objective of this Scheme is to meet financial needs of MSMEs for implementing Energy Efficiency (EE) measures on an end to end basis.

Under this Scheme, MSMEs may also be assisted with technical solutions, including walk-through audit, detailed energy audit, bankable Detailed Project Report (DPR formulation), implementation support, and advisory services. For more information on this, please contact SIDBI via means mentioned below.

How is it being implemented?

Under this Scheme, direct financial assistance in the form of loans is given to,

Existing Micro, Small, and Medium Enterprises (MSMEs) in manufacturing or services sector (including Export Oriented Enterprises)

What’s on offer?

I. Product

Term Loan
Ticket Size: ₹10 Lakhs to ₹3 Crores (This has increased from ₹1.5 Crores in the past)

II. Purpose:

Capital expenditure including for purchase of equipment/ machinery, installation, civil works, commissioning, etc. for implementing the Energy Efficiency measures as recommended in the DPR
Any other related expenditure required, provided it is not more than 50% of above
Financing of second hand machinery/equipment; purchase of land and construction of building (except minor civil works) shall not be taken up under the Scheme

III. Borrower Type:

Individual, Sole Proprietorship, Partnership, Limited Liability Partnership (LLP), Company, Society, Trust, Association of Persons and any other legal entity as may be considered by SIDBI from time to time

IV. Security or Collateral or Guarantee or Insurance

Security: First charge over assets created out of the loan disbursed under the Scheme
Collateral: 20% security in the form of Fixed Deposit if 100% financing has been availed. For more information around this, please contact SIDBI via means mentioned below
Guarantee: Nil
Insurance: For more information around this, please contact SIDBI via means mentioned below

V. Interest Rate

REPO Rate OR Marginal Cost of Funds Based Lending Rate (MCLR) linked rate of interest
- Current Repo Rate is 6.5%
- SIDBI’s MCLR w.e.f January 10, 2024 is 8.2%
- Furthermore, you may look for the prevailing MCLR at any point of time by scrolling here and looking for Interest Rate Structure – Direct Lending Products

VI. Processing Fee

Likely to be 0.5%
For more information around this, please contact SIDBI via means mentioned below

VII. Margin Money Requirement

NIL if 100% of the Project Cosr is financed (as 20% security in the form of Fixed Deposit is required to be given as suggested above)
For all other cases, 10% promoter contribution would be required

VIII. Tenure, Repayments & Pre-Closures

Tenure: upto 60 months (including a moratorium of 6 months)
- For loans upto ₹50 Lakhs, tenure shall not be more than 36 months (including a moratorium of 6 months)
- For loans above ₹50 Lakhs, tenure shall not be more than 60 months (including a moratorium of 6 months)
For more information around repayments, pre-closures etc., please contact SIDBI via the means mentioned below

IX. Turnaround Time

Quick sanction & disbursement can be expected for this Scheme on account of seamless loan application journey, automated loan processing and immedite in-principle offer
For more information around this, please contact SIDBI via the means mentioned below

Interested? Read ahead to check your eligibility….

I. Are you are an existing Micro-enterprise, Small-enterprise, or a Medium-enterprise as per MSMED act of 2006 (including Export Oriented Enterprises) operating in manufacturing or services sector?

II. Has your business been in operation for atleast 1 year?

III. Your business has never defaulted with any Bank(s) or Financial Institution(s)?

IV. Will the required Capital Expenditure/ Project Cost envisaged to be incurred help your business tranit to cleaner fuel?

V. Will your business be able to establish energy efficiency / Greenhouse Gas (GHG) emission reduction?

VI. Does your business comply with SIDBI’s Environment & Social Management Framework?

VII. Has your business undergone the process of Detailed Energy Audit (DEA) through a technical agency / consultant having BEE certified Energy Auditors?

If your answers to the questions above are an emphatic YES, you are all set to avail loan under SIDBI’s End to End Energy Efficiency (4E) Scheme!