PMEGP Govt Loan: How to apply for PMEGP; check loan structure, eligibility here

Financial support is necessary to start a business or to expand or grow an existing business. The Prime Minister Employment Generation Programme (PMEGP)  allows funding support to the Micro, Small & Medium Enterprises (MSMEs) for stabilising and expanding their existing businesses. Individuals willing to start new businesses can also get loans from this initiative. The scheme comes under the Khadi and Village Industries Commission (KVIC).  Governmental bodies like State Khadi and Village Industries Boards (KVIBs), State KVIC Directorates, District Industries Centres (DICs), and some banks are responsible for the plan at the state level. KVIC will deposit the government subsidy directly into the recipient’s bank account through some selected banks, according to the details of the scheme. Loan Structure: There are certain limit for different businesses in terms of how much loan they can avail:

1. Manufacturing Sectors businesses are allowed to get a maximum project amount of Rs 25 lakh.
2. Service sectors businesses are allowed to get a maximum project amount of Rs 10 lakh.

The beneficiary rate will vary according to the applicant’s category and location.

1. General Category: 15 percent for Urban and 25 percent for Rural subsidies
2. Special Category ( SC/ST/OBC/Minorities/Women, Ex-Servicemen, Physically Handicapped those in  NER, Hilly and Border Areas):  25 percent for Urban and 35 percent for Rural subsidies

Banks will provide the balance amount of the total loan in the form of a term loan and working capital. Eligibility Criteria: The minimum age limit for an individual applying for a loan is 18 years. An individual should have passed the 8th standard in school to be eligible for a loan of over Rs 10 lakh in the business sector and Rs 5 lakh in the manufacturing sector. Check details here. Eligible businesses under the PMEGP Scheme:

• Agriculture & Food Processing
• Forest-Based Products
• Hand Made Paper and Fibre
• Mineral Products
• Polymer and Chemical Products
• Rural Engineering and Bio-Tech
• Service and Textile

Steps to follow while applying:

1. Visit the official website of KVIC - kviconline.gov.in.
2. Click on the link of  ‘Online Application form for Individual’ / ‘Online Application form for Non-Individual’
3. Fill up the form on the next page with the required details.
4. Upload the necessary documents and submit the PMEGP form.
5. Following the final submission, the application ID and password will be sent to you on your registered mobile number via SMS.

Required documents:

1. Aadhaar card
2. PAN card
3. Project report having details of the project
4. Caste certificate or any other Special category certificate (if needed)
5. Rural Area Certificate
6. Education qualification certificate/ Skill Development Training certificate
7. Collateral of PMEGP scheme loan (if loan is over Rs 10 lakh)

The PMEGP was started by the Centre in 2008.