PMEGP Loan
PMEGP is the abbreviation for the Prime Minister Employment Generation Programme. It is a government-based credit linked subsidy scheme for providing financial assistance to those individuals who want to set up their new enterprises under the programme. The scheme was implemented at the national level by the nodal agency called Khadi and Village Industries Commission (KVIC). The PMEGP loan is distributed through State Khadi and Village Industries Commission Directorates, State Khadi and Village Industries Board, District Industries Centres, and banks at the state level. The PMEGP loan interest rate varies from 11% to 12% per annum.
PMEGP (Prime Minister Employment Generation Programme)
PMEGP full form is the Prime Minister’s Employment Generation Programme. Under the PMEGP scheme, the Government of India offers a subsidy on various projects on the basis of different criteria. The maximum amount of the project/unit permitted in the manufacturing sector under the scheme is limited to Rs. 25 Lakhs, while the limit set for the service/business sector is Rs. 10 Lakhs.
You can apply for the second loan up to Rs. 1 Crore for upgradation or expansion of your PMEGP/REGP/MUDRA unit. The government subsidy available under the second loan varies from 15% to 20%.
PMEGP Loan Details
Following are the key PMEGP loan details:
| Rate of interest | 11% - 12% p.a. |
|---|---|
| Maximum project cost | Rs. 25 Lakhs for Manufacturing Unit & Rs. 10 Lakhs for Service Unit |
| Subsidy on project | 15% to 35% |
| Age | At least 18 years of above |
| Eligible entities | Business owners, co-operative societies, institutions, charitable trusts, and self help groups |
| Education required | At least 8th pass |
| PMEGP loan process time | 60 days |
PMEGP Subsidy
The categories of PMEGP subsidy rate under the programme are given below:
| Categories of Beneficiary | Beneficiary’s Share of Total Project | Subsidy Rate (Urban) from Government | Subsidy rate (Rural) from Government |
|---|---|---|---|
| General | 10% | 15% | 25% |
| Special (including minorities, SC/ST, ex-servicemen, OBC, NER, physically handicapped, hill & border regions, etc.) | 5% | 25% | 35% |
The remaining amount of the project cost will be provided by banks as working capital and term loan.
The government subsidy available for the second loan varies from 15% to 20%.
PMEGP Loan Interest Rate
The PMEGP loan scheme interest rate usually ranges between 11% to 12% p.a., and the repayment tenure can vary from 3 to 7 years after an initial moratorium period of up to 6 months. The interest rate varies from bank to bank depending on the applicant’s profile, project cost and business stability.
Documents Required for PMEGP Loan
- Aadhaar card
- PAN card
- Caste certificate
- Project report
- Special category certificate
- Rural area certificate
- Education/ skill development/ Entrepreneurship Development Programme training certificate.
- Registration certificate, authorisation letter, and certificate for special category (when required), for institutions.
How to Apply for PMEGP Loan?
The Divisional/State Directors of KVIC in consultation with the Director of Industries of respective states and the Khadi and Village Industries Board releases local advertisements through electronic and print media inviting applications with project proposals from potential beneficiaries who are looking for starting a service unit or establishing an enterprise under the programme.
The process to apply for PMEGP loan yojana on the portal is mentioned below in steps:
- Visit any one of the websites from kviconline.gov.in or my.msme.gov.in for pmegp online application.
- Click on the ‘Prime Minister Employment Generation Programme’ tab or ‘PMEGP ePortal’ on the PMEGP e portal.
- Now click on the ‘Application Form for Individual’ option and the application form will be displayed on your screen.
- The portal has two unique application forms. One for institutional applicants and another one for individuals.
- Fill in the application form by providing all the required details including your name, type of activity, sponsoring agency, educational qualification, bank account details, and so on.
- Then click on the ‘Save applicant data’ tab.
- Upload the required documents and submit them.
- On submitting your documents along with the application form, an application ID and a password will be sent to your registered mobile number.