PMEGP • Credit-Linked Subsidy
PMEGP Scheme
Eligibility, Subsidy and How to Apply
The Prime Minister's Employment Generation Programme (PMEGP) provides up to 35% government subsidy on project costs for new manufacturing and service enterprises. Learn who qualifies and how to apply.
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What It Is
What Is The PMEGP Scheme?
The Prime Minister's Employment Generation Programme (PMEGP) is a credit-linked subsidy scheme implemented by the Ministry of MSME through the Khadi and Village Industries Commission (KVIC). It aims to generate employment by helping individuals set up new micro-enterprises.
Under PMEGP, new manufacturing units can avail of project funding up to ₹25 Lakhs and service-sector enterprises up to ₹10 Lakhs. The government provides a subsidy of 15% to 35% of the project cost depending on the applicant category and location, while the applicant contributes 5% to 10% as their own margin money.
PMEGP is available across all states and union territories of India and is administered through KVIC, State Khadi and Village Industries Boards (KVIBs), and District Industries Centres (DICs). It does not support expansion of existing units - only new enterprises qualify.
Why Founders Apply
- 01
Up to 35% subsidy for rural special categories
- 02
Own contribution of only 5-10%
- 03
New manufacturing up to ₹25 Lakhs, services up to ₹10 Lakhs
- 04
Implemented by KVIC, KVIBs and DICs nationwide
Key Benefits
Key Benefits Of PMEGP
Rural And Urban Subsidy Slabs, Low Margin Money, And Government-Backed Bank Credit For New Units.
01
High Subsidy For Rural Areas
Rural applicants from general categories get 25% subsidy; SC/ST/Women/Minorities/Ex-servicemen and Differently Abled in rural areas get 35% subsidy.
02
Urban Subsidies Available
Urban general category applicants receive 15% subsidy; special categories (SC/ST/Women etc.) get 25% subsidy.
03
Low Own Contribution
General category beneficiaries contribute only 10% of the project cost; special categories contribute just 5%.
04
No Collateral For Small Loans
Projects up to ₹10 Lakhs under manufacturing and ₹5 Lakhs under service sector typically don't require collateral.
05
Wide Sector Coverage
Covers manufacturing, food processing, textile, handicrafts, agro-based industries, bio-technology and service sectors.
06
Government-Backed Credit
Bank loan component is backed by the government subsidy, improving approval chances significantly.
Who Qualifies
PMEGP Eligibility Criteria
Only New Enterprises Are Eligible - Existing Businesses Cannot Apply For PMEGP Expansion.
Applicant Rules
Age
Minimum 18 years of age at the time of application.
Education
8th standard pass is mandatory for projects costing above ₹10 Lakhs.
New Units Only
Only new businesses qualify. Existing units, upgrades or expansions are not eligible.
Category & Exclusions
Special Categories
SC/ST, Women, Ex-servicemen, Differently Abled, NER residents, Minorities and Hill/Border area residents get higher subsidies.
Institutions
Self Help Groups (SHGs), Charitable Trusts, and Institutions registered under Societies Registration Act 1860 are also eligible.
No Prior Beneficiary
Applicants who have already availed of government subsidy under any other scheme are not eligible.
How To Apply
How To Apply For PMEGP
Six Steps From The KVIC E-Portal To Bank Sanction And Subsidy Credit After Production Starts.
- STEP 01
PROCESS
Register On PMEGP Portal
Create an account on the official PMEGP e-Portal (kviconline.gov.in) and fill in your personal and enterprise details.
- STEP 02
PROCESS
Prepare Your Project Report
Draft a detailed project report covering business plan, investment plan, employment projection and market feasibility.
- STEP 03
PROCESS
Submit Application Online
Upload all required documents and submit your application online through the PMEGP portal.
- STEP 04
PROCESS
Interview By Task Force
A Task Force committee (KVIC/KVIB/DIC) reviews your application and conducts an interview or field visit.
- STEP 05
PROCESS
Bank Sanction & Margin Money
After committee approval, the bank sanctions the loan. You deposit your margin money contribution.
- STEP 06
PROCESS
Subsidy Credited
Once the unit starts production, the subsidy amount is credited to your loan account by the bank within 3 years.
Paperwork
Documents Required For PMEGP
Important: Have these ready before applying on kviconline.gov.in. Vikas Bharat guides you from document preparation to bank sanction so the subsidy file does not stall on a weak DPR.
Identity proof - Aadhaar, PAN, or Voter ID
Address proof - bank passbook, electricity bill, or Aadhaar
Detailed Project Report with cost estimates, revenue projections and market analysis
Educational certificate - 8th standard or higher (mandatory for projects above ₹10 Lakhs)
Caste/category certificate if claiming special category subsidy
Udyam registration or proof of new enterprise intent
Recent passport-size photographs of the applicant
- What is PMEGP?
- PMEGP (Prime Minister's Employment Generation Programme) is a government subsidy scheme that helps new businesses get funding of up to ₹25 Lakhs (manufacturing) or ₹10 Lakhs (service) with 15-35% government subsidy.
- Who implements PMEGP?
- PMEGP is implemented at the national level by KVIC (Khadi and Village Industries Commission) and at the state/district level by KVIBs and DICs.
- Can an existing business apply for PMEGP?
- No. PMEGP is only for new enterprises. Existing units looking to expand or upgrade are not eligible for PMEGP funding.
- What is the margin money contribution?
- General category applicants must contribute 10% of the project cost as margin money. Special category beneficiaries (SC/ST, women, minorities etc.) contribute only 5%.
- How long does PMEGP approval take?
- Typically 30-90 days from the date of complete application submission, subject to document verification, task force interview and bank processing.
PMEGP Questions, Answered
Who Implements It, New Units Only, Margin Money, And How Long Approval Usually Takes.
What is PMEGP?
PMEGP (Prime Minister's Employment Generation Programme) is a government subsidy scheme that helps new businesses get funding of up to ₹25 Lakhs (manufacturing) or ₹10 Lakhs (service) with 15-35% government subsidy.
Who implements PMEGP?
Can an existing business apply for PMEGP?
What is the margin money contribution?
How long does PMEGP approval take?
Keep exploring
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Open CGSS Scheme
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