Govt Scheme

Start Your Business with Ease: All You Need to Know About the PMEGP Loan Scheme

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Prime Minister’s Employment Generation Programme (PMEGP)
Prime Minister’s Employment Generation Programme (PMEGP)

Want to start your own business? Take the first step with a PMEGP loan scheme!

Contents
What is PMEGP?Who is eligible?What are the Project Limitations?The main benefits of PMEGP are:Which business comes under PMEGP?What is the PMEGP 35 subsidy?How to apply for PMEGP loan?

Many people dream of starting a personal business. But in the beginning, lack of funds comes in the way. If you are a citizen of India and want to become an entrepreneur, the Prime Minister’s Employment Generation Program (PMEGP) can be the key to unleashing your potential.

What is PMEGP?

PMEGP is a loan-linked subsidy scheme launched by the Government of India to promote self-employment and generate income opportunities. It is implemented by the Ministry of Micro, Small & Medium Enterprises (MSME) and the Khaadi and Village Industries Commission (KVIC).

Who is eligible?

 Indian citizens aged 18 to 59 years.

 Unemployed or underemployed people who wish to establish new micro businesses in the  non-agricultural sector.

 Special categories like SC/ST/OBC/Women/Ex-Servicemen/Physically Handicapped/NER residents may get higher subsidy.

What are the Project Limitations?

Maximum project cost is ₹ 25 lakh for manufacturing units and ₹ 10 lakh for service/business units.

The main benefits of PMEGP are:

  • Reduced financial burden: Subsidy makes starting your business cheaper.
  •  Subsidized interest rates: Low interest rates on bank loans reduce your repayment burden.
  •  Expert Guidance: PMEGP provides training and support to run your business successfully

Which business comes under PMEGP?

Many types of businesses come under the PMEGP scheme. But certain types of businesses are on the exempt list. That means they will not get help under the scheme.

Incoming Businesses:

Manufacturing: Household appliances, clothing, food items, handicrafts, rural industries etc.

Services: Transport (excluding autorickshaws, tourist boats), computer training, beauty salons, photography, repair shops etc.

Agriculture based: such as orchards, dairy, fish farming, organic farming.

Others: such as waste management, eco-friendly products, reusable equipment.

Businesses that cannot come:

Businesses that sell meat or alcohol.

Manufacture of polythene bags, plastic containers less than 20 microns.

Livestock, sericulture, horticulture and horticulture related businesses.

Businesses receiving assistance under other schemes of the Central or State  Governments.

Especially to confirm whether your particular business idea is suitable for PMEGP scheme, for complete details visit the official website https://www.kviconline.gov.in/pmegpeportal/pmegphome/index.jsp

 or contact your local Khaadi and Rural Industries Commission (KVIC) office.

What is the PMEGP 35 subsidy?

The 35 percent subsidy available under PMEGP is a subsidy given by the government on the project cost of the business you are about to start. What this means is that the government will cover up to 35% of the total cost of your chosen business and the rest you can borrow from the bank.

For example:

Suppose you want to start a tailoring unit. The cost of the project is ₹5 lakh. Then 35% subsidy i.e. ₹1.75 lakh will be borne by the government. So, you have to borrow ₹3.25 lakh from the bank.

The subsidy percentage varies depending on the type of project and where you are located.

 A maximum subsidy of 35% is available for businesses starting in rural areas.

 Up to 25% subsidy for businesses starting in urban areas.

However, this subsidy percentage is higher for some special categories.

SC/ST/OBC/Women/Transgender/Physically Handicapped will get maximum 50% subsidy in rural areas and maximum 35% subsidy in urban areas.

How to apply for PMEGP loan?

Application Process:

Apply Online: Go to PMEGP website https://www.kviconline.gov.in/pmegpeportal/pmegphome/index.jsp

 Select “Individual” or “Non Individual” option, enter the required details and submit the application.

Submit a project report: Prepare a comprehensive project report detailing your business idea, costs, and revenue projections. It should be uploaded online.

 Selection of Sponsoring Agency: Select a sponsoring agency for your business. Usually sponsored by Khadi and Rural Industries Commission (KVIC) or District Industries Center (DIC).

 Selection of Pre-Finance Bank: Select the bank offering the loan. A list of banks affiliated with PMEGP is available on the website.

 Verification and Approval: The sponsoring agency and bank will have to verify and approve your application.

 Workshop Attendance: There is a workshop or training program that must be attended under PMEGP.

 Loan Agreement: Rs

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