PMEGP

Launched in August 2008, Prime Minister's Employment Generation Programme (PMEGP) is a credit-linked subsidy scheme, administered by the Ministry of Micro, Small and Medium Enterprises (MSME). PMEGP aims to generate employment opportunities through the establishment of micro-enterprises in

The "Prime Minister’s Employment Generation Programme (PMEGP)" is a credit-linked subsidy scheme launched in 2008 by the Ministry of Micro, Small, and Medium Enterprises (MSME). The scheme aims to generate employment opportunities by supporting the establishment of new micro-enterprises in both rural and urban areas. It promotes self-employment among traditional artisans, unemployed youth, and other eligible beneficiaries in the non-farm sector. PMEGP is being implemented by the Khadi and Village Industries Commission (KVIC) along with KVIBs, DICs, Coir Board, and banks. The scheme has been continued for the period 2021-22 to 2025-26 to support enterprise creation and sustainable livelihood generation across the country.

> For PMEGP new enterprises (Units)

• Any individual, above 18 years of age.
• There will be no income ceiling for assistance in setting up projects under PMEGP.
• For setting up of project costing above Rs.10 lakh in the Manufacturing sector and above ₹ 5,00,000 in the Business /Service sector, the beneficiaries should possess at least VIII standard pass educational qualification.
• Assistance under the scheme is available only for new projects sanctioned specifically under the PMEGP.
• Existing Units (under PMRY, REGP, or any other scheme of the Government of India or State Government) and the units that have already availed of Government Subsidy under any other scheme of the Government of India or State Government are not eligible.

> For up-gradation of existing PMEGP / REGP / MUDRA units

• Margin Money(subsidy)claimed under PMEGP has to be successfully adjusted on the completion of the lock-in period of 3 years.
• The first loan under PMEGP/REGP/MUDRA has to be successfully repaid in the stipulated time.
• The unit is profit-making with good turnover and has the potential for further growth in turnover and profit with modernization/upgrading of the technology.

Reservation / Preference / Priority

Priority will be given to the persons affected by natural calamities/disasters in the areas which are declared as affected by "disaster" as defined under Section 2(d) of the Disaster Management Act, 2005 by the Ministry of Home Affairs.

> Funds under PMEGP Scheme will be available under two major heads:

1. Margin Money Subsidy

a) Funds will be allocated under annual Budget Estimates toward disbursement of Margin Money (subsidy) for setting up new micro-enterprises/units; and

b) From the funds allocated under BE for the Margin Money subsidy, ₹ 100 Crores or as approved by the competent authority will be earmarked for each FY towards disbursement of Margin Money (subsidy) for the upgradation of existing PMEGP/REGP/MUDRA units.

2. Backward and Forward Linkages

5% of the total allocation under BE for a Financial Year against PMEGP, or as approved by the competent authority, shall be earmarked as funds under Backward and Forward Linkages and will be utilized for arranging awareness camps, State/District level monitoring meetings, Workshops, Exhibitions, Bankers meetings, TNDA, Publicity, Entrepreneurship Development Programme (EDP) training, Physical verification & Geo-tagging, Evaluation & impacts Assessment study, Setting of Entrepreneurship Facilitation Centre (EFC), Center of Excellence (CoE), Engagement of Field Experts and Data Entry Operators (DEOs), Creation and Upgradation of IT infrastructure, Awards, Call Centre facility, PMU, and other related activities and settlement of other residual liabilities by the KVIC.

> Levels of support under PMEGP

1. For setting up new micro-enterprise (units)

a) Categories of beneficiaries under PMEGP (for setting up of new enterprises): General Category

Beneficiary's contribution (of project cost): 10% Rate of Subsidy (of project cost): 15% for Urban Areas, 25% for Rural Areas.

b) Categories of beneficiaries under PMEGP (for setting up of new enterprises): Special Category (including SC, ST, OBC, Minorities, Women, Ex-Servicemen, Transgenders, Differently abled, NER, Aspirational Districts, Hill and Border areas(as notified by the Government), etc.

(i) Beneficiary's contribution (of project cost): 05%

(ii) Rate of Subsidy (of project cost): 25% for Urban Areas, 35% for Rural Areas.

Note:

• The maximum cost of the project/unit admissible for Margin Money subsidy under the Manufacturing sector is ₹50,00,000.
• The maximum cost of the project/unit admissible for the Margin Money subsidy under the Business/Service sector is ₹20,00,000.
• The balance amount (excluding the own contribution)of the total project cost will be provided by Banks.
• If the total project cost exceeds ₹50,00,000 or ₹20,00,000 for Manufacturing and Service/Business sector respectively, the balance amount may be provided by Banks without any Government subsidy.

2. 2nd Loan for Upgradation of Existing PMEGP / REGP / MUDRA Units

a) Categories of beneficiaries under PMEGP (for upgradation of existing units): All Categories

b) Beneficiary's contribution (of project cost): 10%

c) Rate of Subsidy (of project cost): 15% (20% in NER and Hill States).

Note:

1) The maximum cost of the project/unit admissible for Margin Money subsidy under the Manufacturing sector for upgradation is ₹10,00,00,000. The maximum subsidy would be ₹15,00,000 (₹20,00,000 for NER and Hill States).

2) The maximum cost of the project/unit admissible for Margin Money subsidy under the Business/Service sector for upgradation is ₹25,00,000. The maximum subsidy would be ₹3,75,000 (₹5,00,000 for NER and Hill States).

3) The balance amount (excluding the own contribution)of the total project cost will be provided by Banks.

4) If the total project cost exceeds ₹10,00,00,000 or ₹25,00,000 for Manufacturing and Service/Business sector respectively, the balance amount may be provided by banks without any Government subsidy.

For PMEGP new enterprises (Units):

• Existing Units (under PMRY, REGP, or any other scheme of the Government of India or State Government) and the units that have already availed of Government Subsidy under any other scheme of the Government of India or State Government are not eligible.
• Only one person from one family is eligible for obtaining financial assistance for setting up of projects under PMEGP. The 'family’ includes self and spouse.

Negative List of Activities:

The following list of activities will not be permitted under PMEGP for setting up of micro

enterprises/ projects/units:-

• 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/Pan/ Cigar/Cigarette etc., any Hotel or Dhaba or sales outlet serving liquor, preparation/producing tobacco as raw materials, tapping of toddy for sale will not be allowed.
• 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.However, value addition under these will be allowed under PMEGP. Off Farm/Farm Linked activities in connection with sericulture, horticulture, floriculture etc. will also be allowed.
• Activities prohibited by Local Government/Authorities keeping in view environment or socio-economic factors will not be allowed .