The central government implements the PMEGP scheme to improve self-employment opportunities for manual workers and unemployed youth.
This scheme provides loans from Rs.5 lakh to Rs.25 lakh with a 15-35% subsidy for self-employment in manufacturing, services, or business sectors.
Prime Minister’s Employment Generation Program (PMEGP) is a scheme the Central Government offers. Banks provide subsidized loans as part of self-employment.
Pradhan Mantri Rojgar Yojana (PMRY) and the Rural Employment Generation Program (REGP) combine these schemes to implement the Pradhan Mantri Employment Generation Programme.
The primary goal of the PMEGP scheme is to create self-employment opportunities for unemployed youth and artisans through micro business enterprises in the non-agricultural sector.
The Khadi and Village Industries Commission (KVIC) is the nodal agency for the PMEGP scheme. It provides a 15% to 35% subsidy on loans ranging from Rs.5 lakh to Rs.25 lakh.
At the state level, the State KVIC Directorates, District Industries Centres, State Khadi, Village Industries Boards, etc., implement this scheme through banks. Under this scheme, KVIC provides loans to beneficiaries of government-subsidized banks.
Eligibility Criteria
- Individuals over 18 are eligible for the PMEGP scheme. Depending on self-employment projects, a minimum 8th class pass is required.
- The project value is more than Rs.10 lakh in the manufacturing sector, Rs.10 lakh in the business or service sector, and should be more than 5 lakhs.
- This scheme is considered for sanctioning new projects.
- Self-help groups (SHGs), Organizations registered under the Societies Registration Act-1860, Product-Based Cooperative Societies, and Charitable Trusts are eligible.
- Units already receiving government subsidies under any other schemes of Central and State Governments are ineligible.
The maximum project or unit cost in the manufacturing sector is Rs.25 lakh,; in the business or service sector,, the maximum loan amount is Rs.10 lakh.
General category beneficiaries will be given 15% subsidized loans in urban areas and 25% in rural areas. Other category beneficiaries (SC, ST, BC, women, others) will receive loans at a 25% subsidy in urban areas and 35% in rural areas, ensuring everyone feels included and valued in this scheme.
Documents Required for PMEGP Loan Application
- Aadhaar card
- PAN card
- Application form
- Residence certificate
- 8th Class Pass Certificate
- Project Report
- Additional documents required by bank or financial institution
- Entrepreneur Development Program Training Certificate
- Mobile Number, E-mail ID
- Passport size photographs
PMEGP Application Procedure
1. Eligibility—Before applying, verify your eligibility using the Jan Samarth Portal, a government schemes portal. Enter basic details like business and educational qualifications to assess your eligibility for a PMEGP loan.
2. Estimate Project Cost, Loan—Determine the total cost of your project and how much you want to contribute. If your total project cost is Rs.25 lakhs, or if you can arrange Rs.10 lakhs, enter the details first.
3. Online Application Process
- Click on Government Portal https://www.kviconline.gov.in/pmegpeportal to apply for a PMEGP Loan.
- First, click “Application For New Unit” and enter your Aadhaar details.
- Enter personal and business information.
- Choose a sponsoring agency -KVIC, KVIB or DIC
- Fill in your address
- Register your basic details
- Select your business Manufacturing, Service or Business.
- State what kind of products you make or sell.
4. Training – After sanctioning your loan, you must attend the Entrepreneurial Development Program (EDP) training. This training will help you run your business effectively. EDP training is not required if your project costs less than Rs.2 lakhs.
5. Enter business expenses and bank details.
6. Complete all the details and apply. Save the Application Number and password for future use. Upload the required documents, including passport photos, project reports, and certificates.
7. Scoring Process—In the application, you will be asked to provide details about your dependent family members, home ownership, qualifications, experience, etc. Achieving a score of 60 or higher increases the chances of an application being approved, ensuring you are informed and prepared for the process.
8. Approval of Application, Next Steps—After you submit your application, the details will be forwarded to the nearest KVIB or another agency. You must complete the EDP training before funds are disbursed to your account.