Prime Minister’s Employment Generation Programme (PMEGP)

Scheme:

Government of India had in August, 2008, approved the introduction of new credit linked subsidy programme called Prime Minister’s Employment Generation Programme (PMEGP) by merging the two schemes that were in operation till 31.03.2008 namely Prime Minister’s Rojgar Yojana (PMRY) and The Rural Employment Generation Programme (REGP) Under the scheme, the beneficiary is required to invest his/her own contribution of 10 percent of the project cost. In case of Scheduled Castes/Schedule Tribes and beneficiaries from other weaker sections, the beneficiary’s contribution is 5 percent on the project cost. The remaining 90 and 95% as of the project cost, as the case may be, is granted by banks specified under the scheme. The beneficiaries under the scheme are refunded a certain amount of the loan (25% for general, 35% for weaker sections in rural areas) which is credited after three years from the date of loan was extended. Prime Minister’s Employment Generation Programme (PMEGP) is a credit linked subsidy programme administered by the Ministry of Micro, Small and Medium Enterprises (MoMSME), Government of India, Khadi & Village Industries Commission (KVIC) a statutory organization under the administration on Ministry of MSME is the nodal agency at national level for implementation of the scheme. At state level the scheme is implemented through KVIC, KVIB and District Industries Centre.

Objective:

  To generate employment opportunities in rural as well as in urban areas through setting up of self-employment venture.
  To bring together widely dispersed traditional artisans/ rural and urban unemployed youth and give them self- employment         opportunities to theextent possible, at their place and also to increase their income.
  To provide continuous and sustainable employment to a large segment of unemployed youth, so as to help arrest migration of         rural youth to urban areas.

Scope:

  The Scheme is applicable to all viable (technically as well as economically) projects in rural and urban areas, under the Micro Enterprises        Sector.
  The maximum cost of the project admissible under manufacturing sector is Rs.25 lakhs and bunisness/services sector is Rs.10 lakhs
  Only one person from the family is eligible for obtaining financial assistance under the scheme.
  The scheme is aimed at encouraging manufacturing sector.
  The assistance under the scheme will not be available to activities indicated in the negative list including business activities like        grocery shop, stationery shops etc; farm related activities like goatery, piggery, poultry etc; and urban,rural transport activities.

Eligible Enterprises / Borrowers:

  Any individual, above 18 years of age.
  There will be no income ceiling for assistance for setting up project under PMEGP.
  The beneficiaries should have passed at least VIII standard, for setting up of project costing above Rs.10 lakh in the manufacturing        sector and above Rs.5 lakh in the business/service sector.
  Self Help Groups (including those belonging to BPL provided that they have not availed benefits under any other scheme) are also        eligible for assistance under PMEGP.
  Charitable Trusts.
  Existing units (Under PMRY, REGP or any other scheme of Government on India or State Government) and the units that have already        availed Government Subsidy under any other scheme of Government of India or State Government are not eligible.

Selection of Beneficiaries:

The beneficiaries will identified & selected at all district level by a Task Force Committee consisting of representatives from KVIC/State KVIB/State DICS & Banks and headed bt the District Magistrate / Deputy Commissioner / Collector concerned.

Project Costs:

Cost of the project should not exceeds Rs.25 lakhs in respect of manufacturing activity and Rs.10 lakhs in respect of Services/ business activity for all categories of eligible borrowers.
Bank Finance Subsidy from KVIC Promoter’s Contribution
Urban Area Rural Area
General Category beneficiary / institution 90% 15% 25% 10%
Special category beneficiary / institution 95% 25% 35% 5%

Rate of Interest:

As applicable to the type of activity (industry/service).

Repayment:

3 to 7 years with an initial moratorium not exceeding 6 (six) months.

Security:

  Assets created out of the bank’s finance.
  Personal guarantee of the proprietor / promoter.
  No collateral security up to Rs.5 lakhs.
  Eligible units to be covered under Credit Guarantee Fund Scheme for Micro & Small Enterprises –(CGTMSE. (Excluding Margin Money        / Subsidy component).

Others:

  The credit decision rests with the Bank, on the basis of viability of each project.
  The selected beneficiary has to undergoEDP/Skill Development training fro 2-3 weeks at KVIC/KVIB accredited training center or Rural        Self Employment Training Institute (RSETI) is mandatory.
  No collateral security up to Rs.5 lakhs.
   For more information visit the website of KVIC at www.kvic.org.in conditions apply. The information provided above is only illustrative        and not exhaustive.

Implementation of the PMEGP Scheme (Year wise Target and Achievements)

Union Territory Level Bankers Committee (UTLBC) of UT Ladakh created on January 2020, the Year wise Target and achievements are available from March 2020.
Amount in thousands
Year Targets Achievement %age of Ach.
Year (2019-20) UT of Ladakh A/c Amount A/c Amount Financial