To promote Local for Vocal, a loan facility for small and medium businesses is provided under the Prime Minister's Employment Generation Programme. It helps in making the unemployed employers of others. PMEGP works with the objective of helping people start new ventures that can generate employment in both rural and urban areas. It aims to bring together traditional artisans and unemployed youth in both rural and urban areas and create avenues for self-employment in addition to providing permanent employment to prevent people living in villages from migrating to cities in search of employment. The focus of the PMEGP scheme is on increasing the earning capacity of artisans and increasing the growth rate of rural and urban employment.
PMEGP Loan Eligibility
Individuals as well as other organizations who meet the eligibility conditions can apply for such term loans under PMEGP. The following are the conditions of eligibility:
- If an applicant wants to have a loan of Rs 10 lakhs for a service unit and up to Rs. 25 lakhs for a manufacturing unit then he/she must be above 18 years of age and must have passed at least 8th standard.
Eligible Institutes –
- Business Owners and Entrepreneurs
- Self-Help Groups and Charitable Trusts
- Societies registered under the Societies Registration Act, 1860
- Production Co-operative Society
There is no income limit to avail of this loan. PMEGP loan is given only for new businesses. It is not available to existing businesses established under PMRY, REGP or any other government scheme. Also, any business that has received a subsidy under any other scheme is not eligible for a PMEGP loan.
PMEGP loan Interest rates
The interest rate and subsidy offered under the PMEGP scheme may vary from bank to bank/loan institution. It depends on the applicant's profile, credit eligibility, paying capacity, number of years the business has been running and the total project cost. Loans under PMEGP are offered by banks like SBI, Bank of Baroda, Canara, and Bank of India as well as other private and public sector banks/loan institutions.
Documents required for PMEGP loan
The following documents are required for the PMEGP loan application:
- Duly filled application form with passport-size photograph
- Project report
- Identity and address proof of the applicant
- Applicant's PAN card, Aadhar card and 8th pass certificate
- Special category certificate, if necessary
- Entrepreneur Development Program (EDP) Certificate of Training
- Certificate for SC / ST / OBC / Minority / Ex-Serviceman / PHC
- Academic and technical course certificate, if any
- Other documents required by the bank or loan institution
- Applicants can do PMEGP registration by submitting an online application form on PMEGP e-portal.
The PMEGP loan helpline number is 1800 3000 0034 and applicants can visit the official website to get the state-wise contact numbers.
How to apply for a PMEGP loan online: Following is the procedure to apply online for a PMEGP loan:
Step 1: To fill out the online form, visit the official website of PMEGP (Khadi and Village Industries Commission website) kviconline.gov.in/pmegpeportal/jsp/pmegponline.jsp
Step 2: Follow the guidelines to fill out the online PMEGP application form and fill in all the required information
Step 3: After filling in all the required information, click on 'Save Applicant Data' to save the information
Step 4: After saving your data you have to upload all the documents for the final submission of the application form
Step 5: Once the application is submitted, the applicant's ID number and password will be sent to his/her registered mobile number.
How to apply for PMEGP loan offline
Step 1: Fill the required information in the application form
Step 2: After filling in all the information, save the application as a draft
Step 3: Take a printout of the application form
Step 4: Submit the printout of the application form to the nearest bank
Step 5: Complete all the formalities required by the concerned bank.
Under the Prime Minister Employment Generation Scheme, interested beneficiaries of the country who want to get a loan from the Central Government to start their employment will have to apply under the PMEGP Loan Scheme. Only then can they get benefits under this scheme. The age of the applicant applying under this scheme should be more than 18 years. He/she can start own employment. Any institution registered under the Societies Registration Act, of 1860 can be considered eligible for assistance under PMEGP. If a person takes a loan under the scheme, then they will also be given a subsidy on the loan amount according to category.
Subsidy under the PMEGP scheme
Under the Prime Minister's Employment Generation Scheme, unemployed youth of the open category will be given a 25 per cent subsidy to start an industry in the rural department and a 15 per cent subsidy will be given to start an industry in the urban department. In this, you will have to pay 10 per cent of the money yourself. Special Category/OBC (SC, ST, OBC) ex-serviceman person will be given a 35 per cent subsidy for starting an industry in the rural department and a 25 per cent subsidy will be given for starting an industry in the urban department and in this you will have to invest 5 per cent of the money yourself.