Details about the PMEGP scheme, Eligibility, Categories of Persons allowed, Limits of Subsidy , Negative List of Business, All the details which are required for applying the PMEGP subsidy in a crisp manner

1. PRIME MINISTER’S
EMPLOYMENT
GENERATION
PROGRAMME
(PMEGP)
Prepared By:
PALANKARTA
www.Palankarta.com
Cont: 96108 01235, 96108 01237

2. SALIENT FEATURES
• Introduced by merging REGP (Rural Employment
Generation Proramme) and PMRY (Prime Minister
Rojgar Yojana) for employment generation in Rural
and Urban Area.
• Implemented by KVIC, a statutory organisation under
control of Ministry of MSME, as a single nodal agency
at National Level.
• At State level, state KVIC directorates, DIC (District
Industries Centres).

3. OBJECTIVES • Generate Employment in Rural and Urban by setting up
of New Self EmploymentVentures/Projects.
• To Increase wage earning Capacity of artisans.
• To Facilitate participation of Financial Institutions for
higher credit flow to only NEW MICRO ENTERPRISES.
• Empowering Enterprenures through Skill Development
and Enterpreniual Development Programme (EDP).

4. ELIGIBILITY
• Categories of Borrowers :
1. Individuals above 18 years of age.
2. Self Help Groups (Including from BPL families).
3. Institutes Registered under Societies Act 1860.
4. CharitableTrusts.
5. Production Based Co-Operative Societies.
• Educational Qualification:
Minimum VIII Standard Pass for the Project above
Rs.10 Lacs / Rs. 5 Lacs as the case may be
• Income Ceiling:
No Income Ceiling.

5. ELIGIBILITY Continue….
• Only One Person from a Family
• Available for New Units to be established.
• Existing units or units already availed any Govt. Subsidy either under State / Central Govt.
Schemes are not eligible.
• Project Cost will include Capital Expenditure and one Cycle ofWorking Capital.
• Cost of Project should not include Land Cost. However long lease or rental workshed/
workshop can be included in the Project Cost.
• Maximum Project Cost is Rs.25Lacs in case of Manufacturing and Rs.10 Lacs in case of
Service Sector.

6. QUANTUM OF FUNDING UNDER PMEGP
Categories of Beneficiaries under PMEGP Beneficiary’s
Contribution
(of Project Cost)
Rate of Subsidy (of Project
Cost)
Area (Location of Project/ Unit) Urban Rural
General Category 10% 15% 25%
Special
(including SC / ST / OBC / Minorities /Women, Ex
Serviceman, Physically handicapped, NER, Hill and
Border areas,etc.)
05% 25% 35%

7. CERTIFICATES
REQUIRED
TO BE
ATTACHED • Age Proof Certificate
• Caste Certificate if Beneficiary are from Special Categories
(SC / ST / Minorities / Ex Serviceman etc.)
• Educational Qualification Certificate for projects above
threshold limits.
• 2-3 Weeks EDP Training Certificate if already undergone
the training, else need to do before that.

8. All Public Sector Banks.
All Regional Rural Banks.
SIDBI (Small Industries
Development Bank of India).
Co-operative Banks approved by a
committee headed by the Secretary,
Industries of the State.
Private Sector Commercial Banks
approved by a committee headed
by the Secretary , Industries of the
State.
FINANCING
AGENCIES

9. IMPLEMENTING AGENCIES
Rural area - KVIC, and DIC (District Industries
Centres)..
Urban area - Only DIC

10. BANKFINANCE The Bank will Sanction
• 90% of the project cost in case of General category
• 95% in case special category of beneficiary.
• Capital Expenditure in form of Term Loan ;
• Working Capital in form of Cash Credit.
Credit Guarantee Scheme (CGTMSE) also available for collateral
security free loans.
Normal Rate of Interest is Charged by the Bank.
Repayment Schedule between 3 – 7 Years after Moratorium.
Working Capital Utilization must be 100% atleast once in 3 years Tenure.

11. Analyzing and Preparation of Project Report .
Compilation of Documents Required before submitting the application.
Submission of Application with the Department.
Liasoning with the Department.
Personal Interview will be conducted by Concerned Authority.
Getting the Application approval.
2-3 weeks EDP training
HOWTO APPLY ?

12. APPLICATION SELECTION
Selection basis :
• Background and;
• Personal Interview.

13. OPERATIONALPROCEDURE
The Bank will take their own credit decision on selection of projects.
Once Sanctioned, the beneficiary has to deposit 5% or 10% of the project cost
as Capital Contribution in bank.
First installment of loan will be released to Beneficiaries only after completion of
EDP training.
Project cost will include capital expenditure and one cycle of working capital.

14. Entrepreneurs Development Programme (EDP)
Duration – 2-3 weeks
Training Institutions –
• Departmental and Non Departmental Training Centers of KVIC /KVIB,
• Accredited training Centers,
• Now after COVID 19, the trainings are going Online also.

15. Once subsidy is released it will be kept in form of TDR of 3 years in the name of beneficiary.
No interest will be paid on the TDR and no interest will be charged on loan to the corresponding
amount of TDR.
Subsidy will credit to the Borrower loan account after 3 years of first disbursement of loan.
In case Advance of Bank goes “BAD” due to conditions beyond limit of borrower, then bank may
liquidate the TDR and adjust against the loan liability.
Benefit of subsidy is a One time Arrangement by the Govt. , for any subsequent enhancement
assistance is not available.
Bank has to obtain an undertaking before release of Bank Finance from the beneficiary in case of any
objection from DIC.
Subsidy will be adjusted only after physical verification.
SUBSIDY RELEASE & ADJUSTMENT

16. PHYSICAL VERIFICATION OF PROJECT
100% Physical Verification within a period of 24
months.
Done by External agencies having expertise and
experience in the field.

17. NEGATIVE LIST OF ACTIVITIES
Any Industry/business connected with Meat (slaughter).
Any Hotel or Dhaba or sales outlet serving liquor, preparation / producing tobacco as raw
materials.
Any industry / business connected with cultivating of crops / plantation like Tea, Coffee, Rubber etc.
sericulture (cotton rearing), Horticulture, Floriculture, Animal Husbandry like Pisciculture, Piggery,
Poultry, Harvester machines etc.
Manufacture of Polythene carry bags of less than 20 microns thickness and manufacture of carry
bags or containers made up of recycled plastic which causes environmental problems.
Industries already taking advantage of Khadi Programme under the purview of Certification Rules
and availing sales rebate.
Rural Transport (except Auto rickshaw in Andaman & Nicobar Islands, House boat, Shikara &
Tourist Boats in Jammu & Kashmir and Cycle Rickshaw).

19. For More Details:
PALANKARTA LLP
Location:
MUMBAI | AJMER | NAGPUR | SURAT
Website:
www.Palankarta.com
Contact Us:
96108 01235 ; 96108 01237