All about Prime minister's employment generation programme (PMEGP) scheme

Prime Minister's Employment Generation Programme (PMEGP)

Introduction:

PMEGP (Pradhan Mantri Rojgar Srijan Yojana) is a central government scheme launched in the year 2008-09 to promote micro enterprises. Its main goal is to reduce unemployment through self-employment and create new business and self-employment opportunities. This scheme provides financial support through banks to those people who want to start their own micro-enterprise.

Objective of PMEGP:

The main objective of PMEGP is to create new employment opportunities, provide financial support to small businesses through banks and boost the economic growth of the country. This scheme is beneficial for all sections including specially unemployed youth, women, SC/ST, OBCs and minority communities.

Key Features of PMEGP:

• Project Size (Loan Limit):
• For Service Sector - Upto Rs. 20.00 Lakh
• For Manufacturing Sector - Upto Rs. 50.00 Lakh

• Financial Assistance: Under the scheme, the Government provides credit linked grant on the project amount approved by the bank as follows -

• For General Category: 15% in rural areas and 25% in urban areas.
• For SC/ST/OBC/Women/Minorities/Physically Handicapped: 25% in rural areas and 35% in urban areas.

• Eligibility:
• Minimum age limit is 18 years.
• There is no restriction in the upper income limit.
• For loan more than Rs. 5.00 lakh in service sector and Rs. 10.00 lakh in manufacturing sector, it is mandatory to have passed at least class 8th.
• Only new projects are eligible under the scheme.

• How to apply:   You can apply for PMEGP scheme through KVIC's online portal https://www.kviconline.gov.in/pmegpeportal/pmegphome/index.jsp or you can contact the District Industries Center, KVIB office of your district.

• Documents Required:
• Aadhar card (mandatory)
• Passport photo (mandatory)
• Project report (mandatory)
• Certificate required for special category (if applicable)
• Rural area certificate (if applicable)
• Score card related documents

• Loan Approval: The financing branches of the banks will approve the project on the basis of technical economic feasibility.

• Own Contribution:
• For General Category - 10% of the project cost
• For Reserved Category - 05% of the project cost

                Own Contribution has to be deposited in the loan sanctioning bank branch after loan sanction.

• Who can apply: Only sole proprietorship units can apply, Private Limited, Co-operative, Partnership Firm or other group firms are not eligible to apply under the scheme.

• In which banks to apply: All Public Sector Banks ,Regional Rural Banks(RRB), Co-operative Banks,SIDBI and Private Scheduled Commercial Banks regulated by RBI and approved by SLMC of concern State.

• Criteria for employment: Under the scheme, it is mandatory to employ 1 person per Rs. 3.00 lakh permanent capital investment in plain areas and 1 person per Rs. 4.50 lakh permanent capital investment in hilly areas and A & N Island and Lakshadweep.

• Which is rural area: Area declared as rural area by the State Government/Union Territory or All the areas, irrespective of Population, following Panchayat Raj Institutions

• Entrepreneurship Development Training Program (EDP): Under the scheme, 10 days Entrepreneurship Development Program Training is mandatory for projects above Rs. 05.00 lakhs and 05 days Entrepreneurship Development Program Training is mandatory for projects less than Rs. 05.00 lakhs. EDP Training is not Mandatory for Projects Upto Rs.2.00 Lakhs. Entrepreneur development program training can be done online through Udyami App or offline through RSETI/RUDSETI.

• Collateral Security: As per the guidelines of Reserve Bank of India, collateral security is required for loans up to Rs. 10.00 lakhs sanctioned under Pradhan Mantri Rojgar Srijan Karyakram Yojana.

• Can one apply for more than one project at a time: Under the scheme, only one person from a family can apply for only one project.

• Who all are included in the family: Self and husband/wife

• What is the lock-in period of government Subsidy amount: The grant amount received will be kept as a tender by the sanctioning bank for 03 years on which no interest will be charged nor will the bank charge interest on that amount of loan. On completion of the lock-in period, receipt of adjustment letter and regularization of loan payment, the bank will adjust the amount of government grant from the loan.

• List of negative activities under the scheme: A: The following list of activities will not be permitted under PMEGP for setting up of micro enterprises/ projects/ units.

  i. Any industry/Business connected with Meat(Slaughtered), i.e. processing, canning and/or serving items made of it as food, Production/Manufacturing or sale of intoxicant items like Beedi/Paan/Cigar/Cigarette etc. Hotels or Dhaba or Sales outlet serving liquor, preparation/producing tobacco as raw materials, tapping of toddy for sale will not be allowed.

  (a) However, serving/selling non-vegetarian food at Hotels/Dhabas will be allowed.

  ii. Activities prohibited by Local Government/Authorities keeping in view environment or Socio-economic factors will not be allowed.

  iii. Manufacturing of polythene carry bags of less than 75 microns thickness and manufacture of carry bags or containers made of recycled plastic for storing, carrying, dispensing or packaging of food stuff and any other item which causes environmental problems. Thickness of polythene carry bags shall be governed by the Ministry of Environment, Forest and Climate changes notification for plastic waste management rules and amendments from time to time.

  iv. Any Industry/Business connected with cultivation of crops/plantation like Tea, Coffee, Rubber etc. Sericulture (Cocoon rearing), Horticulture, Floriculture, Animal Husbandry will not be allowed.

  (a) However, value addition under these will be allowed under PMEGP. Off Farm/Farm Linked activities in connection with sericulture, horticulture, floriculture etc. will be allowed.

  Following industry/Business connected with Animal Husbandry will also allowed:

  (a) Dairy-Milk and other dairy products through primarily Cows but also sheep, goats, camels, buffaloes, horses, and donkeys.

  (b) Poultry-Poultry, kept form their eggs and for their meat, include chickens, turkeys, geese and ducks.

  (c) Aquaculture-It is the farming of aquatic organisms including fish, molluscs, crustaceans and aquatic plants.

  (d) Insects -Including Bees, Sericulture, etc.

  (As a special case piggery, which is a major source of livelihood in NER may also be allowed in NER states only).