PMEGP Loans: Fueling Entrepreneurial Success

To generate employment opportunities in rural as well as urban areas of the country through setting up of new self-employment ventures/projects/micro enterprises.

Scope : The scheme is applicable to all technically and economically viable projects in both rural and urban areas.
Project cost: Cost of the project to be set up under the scheme, should not exceed Rs. 50 lakhs in respect of manufacturing activity and Rs. 20 lakhs in respect of Service / business activity (including Term loan for Capital Expenditure and Working Capital, if any) for all categories of eligible borrowers for availing Margin Money Subsidy.
Training: EDP training is mandatory for claiming the Margin Money (subsidy). The prospective entrepreneurs and the beneficiaries whose loan has already been sanctioned by the Banks can undergo EDP training either in online or offline mode.
Margin: Promoter's contribution in General Category should be at least 10% of the project cost and 5% of the project cost in case of special category beneficiary / institution.
Rate of Interest: As per extant guidelines of the Bank issued from time to time, as applicable to the type of activity (industry/service).
Repayment: 3 to 7 years with an initial moratorium not exceeding 6 (six) months.

Any individual, above 18 years of age.
There will be no income ceiling for assistance for setting up projects under PMEGP.
Education Qualification: 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.

Categories of beneficiaries under PMEGP (for setting up of new enterprises)	Rate of Subsidy (of project cost)
Area (location of project/unit	Urban	Rural
General Category	15%	25%
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.	25%	35%

Assets created out of the bank's finance.
Personal guarantee of the proprietor / promoter.
No collateral/ third party guarantees, for loans upto Rs. 10 lakhs sanctioned under the scheme.

A certified copy of the caste/community certificate or relevant document issued by the competent authority in the case of other special categories is required to be produced by the beneficiary.
Existing/old units are not eligible.
Projects without Capital Expenditure are not eligible for Financing under the Scheme.
PMEGP is applicable to all new viable microenterprises, including Village Industries projects except activities prohibited by local Government/Authorities keeping in view environment or socio-economic factors and activities indicated in the negative list of the guidelines.
All new units setup under PMEGP will be mandatorily registered under Udyam Portal before Physical Verification of the Unit and the adjustment of the Margin Money in the PMEGP beneficiary loan account.
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.

Prime Minister's Employment Generation Programme (PMEGP)