Prime Minister's Employment Generation Programme (PMEGP)
1. Created by: merger of Rural Employment Generation Programme ( REGP) with Prime Minister Rozgar
Yoj a n a (PM RY).
2. Applicability: Throughout India.
3. Objectives: To generate employment opportunities in rural as well as urban areas of the country through
setting up of new micro enterprises.
4. Eligibility: (a) Age: Any individual, above 18 years of age (b) Income: No income ceiling
5. Educational Qualification: No minimum or maximum qualification for projects up to Rs 10 lakh in the case of
industry and up to Rs 5 lakh for business or service sector. In case project cost is more than Rs 10 lakh in the
manufacturing sector and above Rs. 5 lakh in the business or service sector, the beneficiaries should be at least
VII! standard pass.
6. Assistance under the Scheme is available only for new _projects.
7. 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.
8. Project cost: (a) Maximum cost of the project under manufacturing sector is Rs. 25 lakh and under
business/service sector is Rs. 10 lakh.
9. Subsidy (Margin Money):
a. General category borrowers: 15% of project cost in urban areas and 25% in rural areas;
b. Special category: 25% in urban areas and 35% in rural areas. (Special category means including SC /
ST, OBC, Minorities,Women, Ex servicemen, Physically handicapped, NER, Hill and Border areas etc.
c. Subsidy provided by KVIC
d. Subsidy should be kept in the Term Deposit Receipt of three years at branch level
e. No interest will be paid on the TDR and no interest will be charged on loan to the corresponding
amount of TDR.
f. Margin money (subsidy) will be credited to the Borrowers loan account after three years from the date
of first disbursement to the borrower/institution, by the Bank.
g. In case the Bank's advance goes 'bad' before the three year period, due to reasons, beyond the
control of the beneficiary, the Margin Money (subsidy) will be adjusted by the Bank to liquidate the loan
liability of the borrower either in part or full.
h. Margin Money (subsidy) will be 'one time assistance', from Government. For any enhancement of credit
limit or for expansion/modernization of the project, margin money (subsidy) assistance is not available.
i. Margin Money (subsidy) assistance is available only for new projects sanctioned specifically under
the PMEGP. 10_ Borrower's Margin: 10% in general category and 5% in special category.
11. Collateral Security: No collateral security for projects involving loan upto Rs. 10 lakh.
12. Repayment schedule may range between 3 to 7 years after an initial moratorium as may be prescribed
by the concerned bank/financial institution.
13. Implementing Agencies: PMEGP will be a central sector scheme to be administered by the Ministry of
Micro, Small and Medium Enterprises (MoMSME). The Scheme will be implemented by Khadi and Village
Industries Commission (KVIC) which will be the single nodal agency at the national level.
14. Identification of beneficiaries: The identification of beneficiaries will be done at the district level by a Task
Force consisting of representatives from KVIC/State KVIB and State DICs and Banks
1. Created by: merger of Rural Employment Generation Programme ( REGP) with Prime Minister Rozgar
Yoj a n a (PM RY).
2. Applicability: Throughout India.
3. Objectives: To generate employment opportunities in rural as well as urban areas of the country through
setting up of new micro enterprises.
4. Eligibility: (a) Age: Any individual, above 18 years of age (b) Income: No income ceiling
5. Educational Qualification: No minimum or maximum qualification for projects up to Rs 10 lakh in the case of
industry and up to Rs 5 lakh for business or service sector. In case project cost is more than Rs 10 lakh in the
manufacturing sector and above Rs. 5 lakh in the business or service sector, the beneficiaries should be at least
VII! standard pass.
6. Assistance under the Scheme is available only for new _projects.
7. 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.
8. Project cost: (a) Maximum cost of the project under manufacturing sector is Rs. 25 lakh and under
business/service sector is Rs. 10 lakh.
9. Subsidy (Margin Money):
a. General category borrowers: 15% of project cost in urban areas and 25% in rural areas;
b. Special category: 25% in urban areas and 35% in rural areas. (Special category means including SC /
ST, OBC, Minorities,Women, Ex servicemen, Physically handicapped, NER, Hill and Border areas etc.
c. Subsidy provided by KVIC
d. Subsidy should be kept in the Term Deposit Receipt of three years at branch level
e. No interest will be paid on the TDR and no interest will be charged on loan to the corresponding
amount of TDR.
f. Margin money (subsidy) will be credited to the Borrowers loan account after three years from the date
of first disbursement to the borrower/institution, by the Bank.
g. In case the Bank's advance goes 'bad' before the three year period, due to reasons, beyond the
control of the beneficiary, the Margin Money (subsidy) will be adjusted by the Bank to liquidate the loan
liability of the borrower either in part or full.
h. Margin Money (subsidy) will be 'one time assistance', from Government. For any enhancement of credit
limit or for expansion/modernization of the project, margin money (subsidy) assistance is not available.
i. Margin Money (subsidy) assistance is available only for new projects sanctioned specifically under
the PMEGP. 10_ Borrower's Margin: 10% in general category and 5% in special category.
11. Collateral Security: No collateral security for projects involving loan upto Rs. 10 lakh.
12. Repayment schedule may range between 3 to 7 years after an initial moratorium as may be prescribed
by the concerned bank/financial institution.
13. Implementing Agencies: PMEGP will be a central sector scheme to be administered by the Ministry of
Micro, Small and Medium Enterprises (MoMSME). The Scheme will be implemented by Khadi and Village
Industries Commission (KVIC) which will be the single nodal agency at the national level.
14. Identification of beneficiaries: The identification of beneficiaries will be done at the district level by a Task
Force consisting of representatives from KVIC/State KVIB and State DICs and Banks
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