What is Prime Minister Employment Scheme?
This scheme is the
result of the merger of earlier two earlier schemes, Prime Minister`s Rojgar
Yojna (PMRY) and Rural Employment Generation Program (REGP).
Objective
- Generate
the employment opportunity in rural as well as in urban areas. This
purpose has to meet through the establishment of new micro-enterprise
/self-employed ventures/projects in rural as well as in the urban areas.
- To
bring together scattered artisans/rural and urban unemployed youth and to
give them the employment opportunity at their place
- To
provide continuous and sustainable employment to the
traditional/prospective artisans and rural and urban unemployed youth so
that migration can be stopped.
- To
help artisans in increasing the wage-earning capacity so that they can
contribute to the growth rate of urban and rural employment.
When was PMEGP started?
PMEGP started in
2008.
Who is monitoring the scheme?
PMEGP is the central
Government scheme. Ministry of Micro, small and medium enterprise is monitoring
the scheme
Implementing /Nodal Agency
At the
national level, the Nodal/Implementing Agency of this scheme is Khadi and
Village Industries Commission (KVIC) Mumbai. At the state level, State KVIC
directorates, State Khadi and Industries boards, and State khadi and village
industries Boards (KVIBs) will implement at the state level and District
Industries Centers (DICs) will implement at the rural level. Banks have been
assigned to implement the scheme. KVIC routs government subsidy directly into
the bank account of beneficiary/Entrepreneur through designated banks.
For the
identification of the beneficiaries, for getting the area- specific viable
projects, providing training, in the internship, handholding and mentoring of
the beneficiaries Implementing agency like KVIC/ KBIBs/DICs align with reputed
institutions like self- help groups (SHGs)/National small Industries
Corporation (NSIC)/Udami Mitra impaneled under Rajiv Gandhi Udami Mitra yojna
(RGUMY)/RSETIs/RUDSETIs/Panchayati Raj Institution and other relevant bodies.
What is PMEGP loan limit?
- The
maximum cost of the project will be 25 lakh in the manufacturing sector
and 10 lakh under the business/service sector
- Out
of the total cost the applicant will have to bear 5% of the project cost
in case of in the special category ( including
SC/ST/OBC/Minority/Ex-servicemen/Physically handicapped/NER/Border areas
etc ) and 10% in case of the general category.
- The
Balance amount of the total project cost will be provided by the bank as
project cost.
How much margin money (Government Subsidy) is available?
The Subsidy will be
available as below-
|
Category
|
Urban
|
Rural
|
|
General
|
15%
|
25%
|
|
SC/ST/Minority/OBC/Women/ Ex.Service men/Physically handicapped/NER/Hill
and boarder areas etc
|
25%
|
35%
|
Who can avail of the scheme?
Individual/Group of
individual entrepreneurs, Institutions, Cooperative societies, self-help
groups, or trusts can avail this scheme.
Which are the disbursing agencies?
27 Public sector
banks, Regional Rural Banks (RRB), Co-operative banks(approved by state-level
task force committee), Private scheduled commercial banks approved by
respective task force committee, Small Industries Development Bank of India can
disburse the loan.
How can I create a project in a PMEGP loan?
Please follow the
following step:
- Choose
an idea of Interest to start a business in the manufacturing or service
sector
- Identify
suitable location/building/Plant( for good location extra marks are there)
you may refer to in marks chart in this article.
- Make
a project/business report ( Model business detail has been provided in
this article. You may refer to that)
Which business comes under PMEGP?
The Whole list of
PMEGP approved model business lists is available on the KVIConline website. You
may find the complete list of businesses here.
What are the potential projects?
You may find the
potential project here
Negative list of businesses that will not be funded under PMEGP
The following list
will not be allowed under PMEGP
- Any
Industry/Business connected with Meat
- Production/Sale
of intoxicant item like Beedi/Gutka/Pan/Cigar/Cigarette
- Any
Sales outlet serving Liquor
- Manufacturing
of Polythene carry bag of fewer than 20 microns
What is the minimum qualification for a PMEGP loan?
Applicant should
have passed the 8th class examination.
What should be the age limit of the beneficiary?
Any adult above the
age of 18 years is eligible for funding under the PMEGP.
Eligibility criteria for new units
- Applicant
should have more than 18 years of age
- There
is no income ceiling for availing of the benefit under PMEGP
- Applicant
should have at least 8th class pass for applying the project costing 10
lakh in the manufacturing sector and 5 lakh in business/service sector
- Subsidy
under PMEGP is available for new projects.
- Self-help
groups including BPL cardholders can also apply under this scheme provided
they have not availed subsidy in any other schemes.
- Society
registered under society registration act 1860/Charitable trust can also
avail the scheme.
- Any
existing unit under PMRY or any other scheme will not be eligible for the
loan.
- A
Project without capital expenditure will not be qualified for this scheme.
- Any
project valued less than 5 lakh which doesn’t require working capital
needs to be cleared from the regional office or the controller of the
bank`s branch. Any such claim should be submitted with a certified copy of
approval from the regional office or the controller of the bank`s branch.
- All
new viable micro-enterprise, including village industries projects except activities
prohibited by local Government/Authorities keeping in view environment or
socio-economic factors and activities keeping in view environment or
social-economic factors and activities indicated in the negative list of
the guidelines, can avail the PMEGP scheme.
- Any
institution /Cooperative Societies/Trusts specifically registered as in
special category like SC/ST/OBC/Minority/women/physically
handicapped/ex-serviceman. They have done necessary mention in their
by-laws then these societies will be eligible for subsidy under a special
category else they will be eligible for the subsidy in the general
category.
- Only
one member from the family (self or spouse) will be eligible under the
PMEGP scheme.
What is the main criterion of the project?
It should fulfill
the following condition:
- It
should full fill the terms and conditions of the rural area project (in
case the project is of the rural area)
- Per
capita investment
- Own
investment of the beneficiary
- The
Project should not be from the negative list
- The
Proposed unit should be the new one
What all will be considered in the project cost?
Project cost will
include capital expenditure loan, applicant`s share of one cycle of working
capital, and 10% of the project cost in case of general category or 5% in the
case is of from the weaker section.
How the Loan amount/Cash credit limit is utilized?
Working capital of
beneficiaries should touch 100% limit of cash credit within three years of the
lock-in period at least once and it should be 75% utilization of the sanctioned
limit on average.
Documents required
- Cast
certificate (if any)
- Special
category certificate, Where ever it is required
- Rural
area certificate
- Project
report
- Education/EDP/Skill
development training certificate
- In
case of institution self-attested copies of registration certificate,
authorization letter/copy of bylaws authorizing the secretary to apply,
certificate to special category (if any) will be required.
Is collateral Security a must?
No, collateral
security is not needed from the beneficiary. As per the RBI guidelines, Credit
guarantee fund trust for micro and small enterprise (CGTSME) will give the
collateral for the loan more than 5 lakh and up to 25 lakh
How much own contribution has to be deposited?
10% for general
category and 5 % for special category (including SC/ST/OBC/Minority/
Ex-servicemen/Physically handicapped/NER/Border areas etc) needs to be
contributed towards own share of contribution.
Where the applicant has to submit the application?
Applicants can
submit applications/project online on KVIC website
What is DIC in PMEGP?
DIC(District
Industries center ) has to play a very major role in PMEGP.DIC is an
implementing agency along with KVIC(Khadi and Village Industries Commission and
KVIB(Khadi and Village Industries Board)
Can an unemployed person get a loan?
Yes under this
scheme loan is collateral-free. So unemployed can also get a loan.
How do I adjust the PMEGP subsidy?
PMEGP subsidy can be
adjusted at the end of 3 years.
Loan for upgrading the existing PMEGP/MUDRA units
- The
maximum cost of the project will be 1 crore in the manufacturing sector
and 25 lakh under the business/service sector
- In
this category, the maximum subsidy will be 15 lakh (20 lakh will be for
NER and Hill states)
- The
balance amount of the total project will be funded by the bank as a term
loan.
Other activities covered under this scheme
Business/trading
activities
- Business/trading
activities in the sales outlet can be allowed in NER, LWE affected
districts, and A&N Islands.
- Retail
outlet/business selling khadi products/Village Industry products which are
purchased from khadi and village Industries institution approved by KVIC
and manufactured by PMEGP/SFURTI units only can be permitted under this
scheme across the country. The maximum cost of this kind of business
/trading activitiy will be 10 lakh and it will be at par with the service
sector.
Transport activities
Under this category
purchase of Cab/Van/Motor/Boat/Shikara etc for the transportation of tourist or
the general public is allowed. A ceiling of 10% will be applicable in this
category except for NER, Hilly region, LWE affected districts and A&N
island and Goa, Puducherry, Daman and Diu, Dadra Nagar haveli,J&K,
Lakshadeep
Eligibility criteria for the up- gradation of existing MUDRA/PMEGP units
- Margin
money claimed under PMEGP should have been already adjusted.
- The
first loan under this PMEGP/MUDRA should have been repaid in time.
- Said
unit should be in the profit with good turnover and it should have a
potential to further upgrade in turnover and profit.
What is the village industry?
Any village industry
(excluding those which are on the negative list) which is located in the rural
area which produces goods or provides services will be called village industry.
It should have fixed the capital investment for the head of full time of
artisan or workers don’t exceed one lakh in case of the plain area and 1.5 lakh
in case of hill area and in the case of A&N island and Laxdeep 4.5 lakh.
What
is Rural Area?
The area will be
called rural if it is in the revenue record of the state irrespective of the
population and also the town which has a population less than 20000.
Is EDP training is must for claiming the Margin Money Subsidy?
Yes EDP Training is
for 10 days for the project costing more than 5 lakh and for 6 working days
training for the project costing up to 5 lakh is a must for the beneficiaries
who would like to claim margin money subsidy.
How can apply for EDP Training?
Follow the following
step for EDP Training
- Get
the application ID
- Registered
mobile number
- Visit the website Click on “ EDP for
PMEGP beneficiary
- Choose
the course
- Click
on Register
- Fill
in the required detail.
- Once
registered, login and fill required detail.
Can the unit be set up in an urban area?
Yes, it can be set
up in the urban area but through the district Industries Center (DIC) only.
What is the lock-in period of Government Subsidy?
The Lock-in period
of Government subsidy is of 3 years.
Can the project be financed by two funding sources at the same time?
No. Under this
scheme no sub funding is available.
The Identification of the beneficiaries
Beneficiaries will
be identified at the district level. This will be done by the state/District
level agencies KVIC/State KVIB and state DICs and banks etc. Banks should be
involved from the beginning itself so that unnecessary bunching of the
applicants should be avoided. Applicants who have already done the training of
two weeks under entrepreneurship development program (EDP)/Skill development
program (SDP)/ Entrepreneurship cum Skill development program(ESDP)/Vocational
training (VT) no need to go for training again and also they should be given
the priority in selection.
Bank Finance
- Bank
will sanction 95% of the project cost in the case of special
category/Institution and 90% in the case of general category/Institution.
Bank will disburse the full amount appropriately for setting up a project.
- Beneficiaries
will be given capital expenditure as term loans and working capital as
cash credit. Bank can also give the amount in the project as a composite
loan consisting of capital expenditure and working capital
- The
Maximum project cost under PMEGP is 25 lakh including a term loan for
capital expenditure and working capital. Share of working capital should
not be more than 40% of the project cost in the case of manufacturing
units and should not be more than 60% of the project cost in the case of
the service/trading sector. In the case of manufacturing units, the
project cost may include a maximum capital expenditure of up to 25 lakh.
in that scenario, working capital over 25 lakh will not be covered under
the subsidy.
Rate of Interest and repayment schedule
- The
Prevailing market rate will be charged.
- The
Repayment payment schedule will be for 3-7 years
- The
Initial moratorium may be prescribed by the concern financial institution.
Modalities of the online process flow of application:
- The
Project proposal will be invited from potential beneficiaries at the
district level through print media, radio, and other media at periodical
intervals.
- Panchayati
raj institutions will also publish the scheme and help in the identification
of the beneficiaries.
- The
application will be filled in online mode only. This facility is available
for individual as well as institutional applicants.
Task Force
A task force with
the following members will be constituted at the district level for monitoring
the progress of the PMEGP scheme.
|
District Magistrate/Depty Commissioner/Collector
|
Chairman
|
|
PD-DRDA/EO-Zila Panchayet
|
Vice Chairman
|
|
Lead Bank Manger
|
Member
|
|
Repersentative of KVIC/KVIB/DIC
|
Member
|
|
Representative of NYKS/SC/ST Corporation
|
Special Invitee
|
|
Representative of MSME-DI,ITI/Polytechnic
|
Special Invitee
|
|
Representative from Panchayat( it has to be nominated by Chairman/District
Magistrate/Deputy Commissioner/Collector by rotation
|
3 members
|
|
Director RSETI/RUDSETI
|
Member
|
|
General Manager, DIC of the district
|
Member convener
|
Scorecard for disbursement of the loan
Personal Details of
the applicant need to be provided. In the case of the institution personal
details of the main promoter should be provided.
|
Sr No
|
Parameters
|
Maximum Marks
|
Marks scored
|
Criteria
|
Marks
|
|
1
|
Age
|
6
|
|
25 to 40
|
6
|
|
18 to 24
|
5
|
|
41 to 49
|
3
|
|
50 & above
|
2
|
|
2
|
No of Dependents
|
2
|
|
Upto 3
|
2
|
|
>3
|
0
|
|
3
|
Owing a house/Parental House
|
5
|
|
yes
|
5
|
|
No
|
2
|
|
4
|
Residing at the same location
|
5
|
|
5 years and above
|
5
|
|
2-5 years
|
3
|
|
Less than 2 years
|
2
|
|
5
|
Academic Qualification
|
4
|
|
Graduation
|
4
|
|
Intermediate or more
|
3
|
|
Metric
|
2
|
|
Below Metric
|
1
|
|
6
|
Experience in the line of trade
|
8
|
|
=>3 years
|
8
|
|
1 to 3 years
|
6
|
|
<1 year
|
3
|
|
Nill
|
0
|
|
7
|
Any other source of Income
incl.family
|
5
|
|
yes
|
5
|
|
No
|
0
|
|
8
|
Assessed for Income tax
|
2
|
|
Assessed
|
2
|
|
Not assesed
|
1
|
|
9
|
Have life Insurance
Policy(PMSBY,PMJJBY,APY or any other insurance policy)*Point 1 for each max 3
|
3
|
|
yes
|
*
|
|
No
|
0
|
|
10
|
Marks Scored
|
40
|
|
|
|
Scorecard
for New Venture /Firm for disbursement of the loan
|
Sr No
|
Parameters
|
Maximum Marks
|
Marks scored
|
Criteria
|
Marks
|
|
1
|
Relationship with lending bank
|
5
|
|
Above 3 years
|
5
|
|
1 to 3 years
|
3
|
|
< a year
|
2
|
|
New
|
1
|
|
2
|
Credit History
|
5
|
|
Very Good
|
5
|
|
Satisfactory
|
4
|
|
No history
|
3
|
|
3
|
Location advantage(Availability of
infrastructure ,raw materials,labour proximity to market etc
|
5
|
|
yes
|
5
|
|
No
|
3
|
|
4
|
Skill certification
course/RSETI/ITS/Computer knowledge
|
5
|
|
yes
|
5
|
|
No
|
2
|
|
5
|
Market tie ups for the sale of
products
|
5
|
|
yes
|
5
|
|
No
|
2
|
|
6
|
Line of activity
|
5
|
|
Mfg/Service
|
5
|
|
trade and others
|
3
|
|
7
|
Registered with government
authorities viz for sales tax/vat/license from local bodies/shop act etc
|
5
|
|
yes
|
5
|
|
No **
|
3
|
|
8
|
Re payment period (Not applicable
for only working capital loans)
|
5
|
|
Upto 5 years
|
5
|
|
Above 5 years
|
3
|
|
9
|
Employment Generation
|
5
|
|
Above 5
|
5
|
|
3 to 5
|
3
|
|
Self Employed
|
2
|
|
10
|
Avg DSCR (Not applicable for only
working capital loans)
|
5
|
|
> 2 Years
|
5
|
|
1.5. to 2
|
3
|
|
|
<1.5
|
2
|
|
|
Marks scored
|
50
|
|
|
|
|
|
**
|
It should be completed.
|
|
|
|
How can apply for the loan
- Visit
the official website of KVIC
- Then
click on PMEGP.
- New page will open up
- Click
PMEGP Portal
- Click
on online application form for the individual/ Nonindividual
- A new
page will open up. Fill in all the required detail.
- You
will get a user ID and password
- At
the time of final submission of the form, you will be provided the
application ID
- Applicant
Aadhar number will be preferred. If the applicant is an Institution then
the authorized person will furnish his/her Aadhar detail.
- After
filling the application and uploading all the required documents click the
summit. Once you submit then your application along with all the documents
will be forwarded to the district representative of KVIC, District
representative of state KVIB and District Industries center of the
concerned district
- After
receiving the documents within 5 working days Nodal officer of KVIC, State
KVIB, and DIC will speak to you personally through phone or personal
meeting. They will confirm that you have submitted the application for
scrutiny. With your consent/consultation, the nodal officers do all the
necessary corrections in your application. The nodal officer will provide
the hand-holding at every stage of the funding.
- The
implementing agencies after primary scrutiny of the application will
forward the complete/corrected application to the financing bank which has
been chosen by you. Copy of your complete application will also go to the
lead bank manager for information and monitoring.
·
The application will be forwarded to the bank within
3 weeks of forwarding by the
Implementing
agency
If you are interested in getting more information on this
then you may join our WhatsApp group
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