If you want to start your small business, but are concerned about your financial capabilities, the Prime Minister Employment Generation Program (PMEGP) Loan Scheme can help. This government initiative provides financial assistance to individuals looking to establish small businesses in manufacturing and service sectors.
What is the PMEGP
PMEGP is a credit-linked subsidy scheme aimed at supporting small businesses. Under this scheme, loans are provided for projects that cost up to Rs 50 lakh in manufacturing sector and Rs 20 lakh in service sector. The applicant requires 5% of the total project cost, and the remaining amount is provided as bank loan.
The PMEGP scheme has been allocated a budget of Rs 13,554 crore from the financial year 2021-22 to 2025-26, ensuring that more people may benefit from this initiative.
Benefits of the PMEGP Loan Scheme
Under this program, beneficiaries in rural areas get 35% subsidy and in urban areas, 25% subsidy is provided. No guarantee is required for loans up to Rs 10 lakh.
The scheme aims to bring together traditional artisans and unemployed youth in rural and urban areas and create self-employment opportunities through setting up small businesses, so as to help in preventing migration of rural youth to urban areas.
At the national level, this scheme is being implemented by the Khadi and Village Industries Commission (KVIC), a statutory organization working under the Ministry of MSME, which acts as the sole nodal agency.
PMEGP Loan Scheme Eligibility
- It is necessary to be an Indian citizen.
- The applicant must be above 18 years of age.
- The applicant must have passed at least 8th standard.
- Businesses which are getting the benefit of other government subsidies will not get help.
How to Apply for the PMEGP Loan Online
- Visit the official website of Khadi and Village Industries Commission (KVIC).
- Click on the option of PMEGP. This will open the page of PM Employment Generation Program.
- Click on the Apply button of Application for New Unit.
- Enter all the asked information in the application form.
- Tick the declaration form and click on save application data.
- This will submit your application form and you will get user ID, password.
Required Documents for the PMEGP Loan Application
- Caste Certificate
- Special Category Certificate, wherever required
- Rural Area Certificate
- Project Report
- Education/EDP/Skill Development Training Certificate
