This article is written by Bhavin Rafaliya.

Introduction

Prime Minister Rojgar Yojana and the Rural Employment Program were merged into the Prime Minister’s Employment Employment Program or PMEGP in 2008. This step was taken to promote the purpose of the previous two programs to generate employment among the youth. The 2008 program has integrated urban and rural approaches to small business start-ups. Therefore, it contributes significantly to job creation and to economic and national growth.

At the National level, the PMEGP is used by the Khadi and Village Industry Commission or KVIC. Many KVIC boards and directors use the program at state level. Funds are disbursed to beneficiaries through selected banks. Under the PMEGP program, by investing only 5% to 10% of the total project cost, beneficiaries can receive up to 35% of funding.

The objectives of the Prime Minister’s Employment Generation Programme (PMEGP)

The PMEGP has four objectives:

1. Creating jobs in rural areas, as well as in cities in India by establishing new businesses or projects.
2. To provide a coherent foundation for the dispersed traditional artists and unemployed youth in rural and urban areas to come together and create a mechanism for self-employment.
3. Taking steps to stop the migration of people from rural areas to cities in search of jobs by providing them with stable and sustainable jobs. This is especially true for indigenous and future artisans and unemployed youth in rural and urban areas who find traditional or part-time work and remain unemployed throughout the year.
4. To increase the earning capacity of artisans and focus on increasing employment growth in rural and urban areas.

PMEGP – Indian Government Credit Link Subsidy Program to support MSMEs

Interest Rate	11% to 12%
Age Criteria	Minimum 18 years
Maximum project cost	Rs. 25 lakh for Manufacturing Unit, Rs. 10 lakh for Service Unit
Subsidy on Project	From 15% to 35%
Eligible Entities	Business owners, Institutions, Co-operative Societies, Charitable Trusts & Self Help Groups
Applicant’s Education	At least 8th class pass

PMEGP loan interest rate

The interest rate and support provided under the PMEGP program from different financial institutions will vary from bank to bank and will depend on the applicant profile, business viability and project costs.

Loans under the PMEGP can be obtained from various qualified national banks such as SBI, Bank of Baroda, Canara, Bank of India and other private and public sector banks and NBFCs.

PMEGP Subsidy and Funding

Beneficiary Categories	Beneficiary’s Share (of Total Project)	Subsidy Rate (from Govt.) – Urban	Subsidy Rate (from Govt.) – Rural
General	10%	15%	25%
Special	5%	25%	35%

How to apply for a PMEGP

One can apply for PMEGP on the official website of the Prime Minister’s Employment Generation Programme for both individual and non-individual applicants. Follow these steps and make your app seamless.

• Land on the official KVIC PMEGP website,https://www.kviconline.gov.in/pmegpeportal/pmegphome/index.jsp.
• Once on the homepage, tap on the ‘Individual Online Application Form’ or on the ‘Individual Online Application Form’. You can copy and paste this URL into another tab ‘https://kviconline.gov.in/pmegpeportal/jsp/pmegponline.jsp’ to directly access individual forms.
• Once the form has been received, fill in the required details.
• Click on ‘Save Applicant Information’ and the file will be saved.
• Submit the required documents and submit them together with the form.
• After successful submission, the consent ID and password will be sent to the applicant’s registered mobile phone number.

For individual applicants, an additional step is required. After accessing the official website and taking the option of ‘Offline Application Form for Non-Persons’, the applicant must select a category from’ Self-help Groups’, ‘Trust’, ‘Regd. Institutions’ and ‘Affiliate Communities’. Part of the forms of the above categories will vary.

PMEGP Eligibility criteria

PMEGP loans are provided to individuals and organizations that meet the terms of such a term loan. The list of eligible businesses that can apply for a loan under PMEGP is outlined below:

• People, over the age of 18; the beneficiary must have studied and passed at least section 8 if he or she wants to establish a production unit costing more than R. 10 lakh or service unit costing more than Rs. 5 lakh and PMEGP loans.
• Self-help groups can also take out a PMEGP loan as long as they do not receive any other benefits under this program.
• Organizations registered under the Public Registration Act, 1860.
• Production Collaborative Organizations.
• Trusts of charities.

There is no income for this loan. The PMEGP loan is only granted to new units and is not available for existing units established under the PMRY, REGP or other government program. In addition, any unit that has received funding under any other program is not eligible for a PMEGP loan.

PMEGP Loan Bank List

Allahabad Bank	ICICI Bank Ltd.
Andhra Bank	IDFC First Bank
Axis Bank	Indian Bank
Bank of Baroda	Kotak Mahindra Bank
Bank of India	Punjab National Bank
Canara Bank	State Bank of India
Central Bank of India	UCO Bank
HDFC Bank Ltd.	Union Bank of India

How do you get a business loan under the PMEGP Scheme?

The following are the steps to apply for the individual PMEGP Online application:

Step 1: Visit the official PMEGP website (Khadi and Village Industry Commission website) to complete the form online or click here: https://www.kviconline.gov.in/pmegpeportal/jsp/pmegponline.jsp

Step 2: Follow the guidelines for completing the PMEGP online application and complete all required information, such as your information.

Step 3: After completing all the required details, click on ‘Save Application Data’ to save the full routes.

Step 4: After you have saved your data you need to upload all the documents for the final submission of the application form.

Step 5: Once the application has been completed and submitted, the applicant’s ID number and password will be sent to his / her registered mobile number.

Steps to Apply for a Loan under the PEMPG Scheme (Offline)

Step 1: Fill in the required information on the application form.

Step 2: After completing all the details, save the program as a framework.

Step 3: Take print out the application form.

Step 4: Send the printed form to the application form to the nearest office.

Step 5: Complete all the related formalities performed by the relevant bank.

Required loan documents

The following documents are required when applying for the PMEGP loan application

• Project report;
• PAN card;
• Aadhaar card;
• VIII Pass Certificate;
• Identity and proof of address;
• Special category certificate, if required;
• Entrepreneur Development Program (EDP) training certificate;
• SC / ST / OBC / Minority / Ex-Servicemen / PHC Certificate;
• Certificate of education and technology.

The PMEGP e-portal provides access to applicants to apply for PMEGP registration online by completing and submitting an online application form at https://www.kviconline.gov.in/pmegp.jsp

PMEGP Loan Helpline is 1800 3000 0034 and for a smart contact number, applicants can visit the official website by clicking here. https://www.kviconline.gov.in/pmegpeportal/pmegphome/index.jsp

In addition, let’s talk about the PMEGP online application process where different people can benefit.

Steps to Check PMEGP Loan Status with PMEGP Tracking System

Step 1: Visit the official PMEGP website or click on this link: kviconline.gov.in/pmegp/

Step 2: Click on the ‘Registered Applicant Login Form’ to open a new page where you can see the login fields and password.

Step 3: Enter your ID and password and click login.

Step 4: Finally to check the status of your PMEGP loan application, you will need to click on ‘View Status’.

Guideline PMEGP Loans

Keep the following in mind to successfully obtain a PMEGP loan:

• Complete the business idea;
• Identify location, plant and other details;
• Create an active project report;
• Choose the appropriate form for each situation and for each individual;
• Upload all required documentation.

PMEGP Loan Details

The sections below look at the various aspects of the PMEGP Loan, from the percentage share of each party in the grant to the interest rate and duration.

PMEGP Loan Allocation: Here’s a look at the dividend funding offered under the PMEGP Loan

1. Once the application has been approved, the bank allocates 95% of the project cost (in the weaker sections of the community) or 90% (to the general applicants).
2. In this case, 15-35% is extra money or subsidies provided by the government. The amount of extra money to be taken by banks will be equal to the actual cost of the money received by the applicant. All other unpaid amounts equal to the unspent amount will be refunded to the Card by the Local Industry Commission (KVIC).
3. All other funds (ie 90/95% of grants granted less than 15-35% subsidy) are provided by the bank as a term loan or a PMEGP loan.

Interest Rate: The PMEGP loan interest rate will be at the normal rate as applicable in the MSE sector.

PMEGP loan period: After the first suspension (usually more than 6 months), the bank may offer a 3-year repayment plan so that borrowers can repay the PMEGP loan.

Major funds/grants: The margin is deposited in a separate savings account linked to the loan account and is closed for a period of 3 years, after which it is repaid with a PMEGP loan or issued.

Capital Requirements: The PMEGP loan requires that operating costs be equal to the credit limit at least once every three years after the margin has closed. In addition, no less than 75% of the allowable use limit.

Categories of Business Loan Grants under the Scheme: PMEGP Loans are offered to businesses in the following categories:

1.     Processing Agricultural Based Foods;
2.     Forest-based products;
3.     Handmade paper and Fiber;
4.     Mineral Based Products;
5.     Polymer and Chemical Based Products;
6.     Rural Engineering and Bio-Tech;
7.     Service and Textile.

Financial assistance under the PMEGP

The scheme provides financial assistance to individuals according to different terms. However, as the program includes small, medium and micro enterprises (MSMEs), there is some clarification on the number of eligible projects and the size of the loans offered.

The amount of contribution required by the borrower is 10% in the general category and 5% in the special categories, such as SC/ST/OBC, minority, women, defense personnel, physical persons, persons from the North East region, hills and border areas, among others.

The level of funding will be 15% of the general category in urban areas and 25% in rural areas. In the specialized categories of people, government subsidies will be 25% of urban areas and 35% of rural areas.

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