Azadi ka Amrit Mahatsav

Pradhan Mantri Employment Generation Program (PMEGP)

The Ministry of Micro, Small and Medium Enterprises (MoMSME) has approved the continuation of PMEGP Scheme for 5 years from FY 2021-22 to FY 2025-26. The scheme is implemented by KVIC which acts as Nodal agency at State level. The State director of the concerned state is authorized to monitor and implement the scheme and activities under BFL besides attending various meetings and workshops.

Quantum and Nature of Finance:

  1. Margin Money Subsidy:
  2. Backward and Forward Linkages

Levels of support under PMEGP

  1. For setting up of new micro enterprise (units)

    Categories of beneficiaries under PMEGP (for setting up of new enterprises)

    Beneficiary’s contribution (of project cost)

    Rate of Subsidy (of project cost)

    Area (location of project/unit)

    Urban

    Rural

    General Category

    10%

    15%

    25%

    Special Category (including SC, ST, OBC, Minorities, Women, Ex-Servicemen, Transgenders, Differentiallyabled, NER, Aspirational Districts, Hill and Border Areas (as notified by the Govt.) etc.

    05%

    25%

    35%

    Note:

    • Maximum cost of Project/unit for Margin Money Subsidy
      1. Manufacturing Sector: Rs.50 lakh.
      2. Business / Service Sector: Rs.20 lakh
    • The Balance amount of total project cost is provided by Bank
    • If the total Project / Unit Cost exceeds Rs.50 lakh and Rs.20 lakh for manufacturing and Business / Service sector respectively, the balance amount may be provided by Bank without any Government Subsidy.

  2. Second Loan for upgradation of existing PMEGP/REGP/MUDRA Units

    Categories of beneficiaries under PMEGP (for upgradation of exiting units)

    Beneficiary’s contribution (of Project Cost)

    Rate of Subsidy (of Project Cost)

    All Categories

    10%

    15% (20% in NER and Hill States)

    Note:

    • Maximum cost of Project/unit for Margin Money Subsidy for upgradation
      1. Manufacturing Sector: Rs.1.00 crore. Maximum subsidy would be Rs.15 lakh (Rs.20 lakh for in NER and Hill States)
      2. Business / Service Sector: Rs.25 lakh. Maximum subsidy would be Rs.3.75 lakh (Rs.5 lakh for in NER and Hill States)
    • The Balance amount of total project cost is provided by Bank.
    • If the total Project / Unit Cost exceeds Rs.1.00 crore and Rs.25 lakh for Manufacturing and Business / Service sector respectively, the balance amount may be provided by Bank without any Government Subsidy.

Eligible Borrowers

  • Any individual, above 18 years of age.
  • No income ceiling for assistance for setting up of projects under PMEGP.
  • Should possess at least VIII standard pass educational qualification for setting up of project costing above Rs.10 lakh in Manufacturing sector and above Rs.5 lakh in Business / Service Sector.
  • Only new projects.
  • Existing units (PMRY, REGP or any other scheme of Govt. of India or State Govt.) and the units that have already availed Govt. Subsidy under any other scheme of Govt. of India or State Govt. are not eligible.
  • Projects without capital expenditure are not eligible.
  • Cost of land is not included in Project Cost.
  • Only one person from one family (self and spouse) is eligible under this scheme

Repayment Tenor

  • Range: 3 to 7 years after an initial moratorium period.

Rate of Interest

  • For MSMEs: RLLR linked
  • For Non MSMEs: RLLR and MCLR Linked (based on activities)