The Prime Minister's Employment Generation Programme (PMEGP) is the result of the merger of two schemes - 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 per cent of the project cost. In case of Schedule Castes/Schedule Tribes and beneficiaries from other weaker sections, the beneficiary's contribution is 5 per cent of 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 that the 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 organisation under the administration of 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 center.
Objective:

• To generate employment opportunities in rural as well as urban areas through setting up of self employment ventures.
• To bring together widely dispersed traditional artisans/ rural and urban unemployed youth and give them self-employment opportunities to the extent possible, at their place and also to increase their income
• To provide continuous and sustainable employment to a large segment of traditional and prospective artisans and 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 as well as urban areas, under Micro enterprises sector.
• The maximum cost of the project admissible under manufacturing sector is Rs.25 lakhs and business/services sector is RS.10 lakhs.
• Only one person from family is eligible for obtaining financial assistance under the scheme.
• Assistance under the Scheme is available only for new projects
• 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(except auto rickshaw, tourist boat & house boat in A & N Islands; Shikara & tourist boat in J & K, & cycle rickshaw)

Eligible Entrepreneurs / Borrowers:

• Any individual, above 18 years of age
• There will be no income ceiling for assistance for setting up projects 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.
• Institutions registered under Societies Registration Act,1860
• Production Co-operative Societies
• Charitable Trusts.
• Existing units (Under PMRY,REGP or any other scheme of Government of 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 the district level by a Task Force consisting of representatives from KVIC/State KVIB/ State DICs and Banks and headed by the District Magistrate / Deputy Commissioner / Collector concerned. 
Project Cost:
Cost of the project should not exceed Rs. 25 lakhs in respect of manufacturing activity and Rs. 10 lakhs in respect of Service / business activity for all categories of eligible borrowers.

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 – CGMSE. (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 undergo EDP/Skill Development training for 2-3 weeks at KVIC/KVIB/accredited training centers is mandatory.
• Applications  with project report and all relevant documents may be submitted to KVIC/KVIB/ Banks
• Application formats may be obtained from 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)

GoI guidelines on PMEGP

Website - Ministry of Micro, Small and Medium Enterprises.

Website - Khadi and Village Industry Commission.

Bankwise Progress As on 30.06.2024