Government of India Initiative
Prime Minister's Employment Generation Programme
Get up to ₹50 Lakhs with 35% Capital Subsidy for your business
₹50L
Max Funding
35%
Max Subsidy
45 Days
Processing
No Collateral
Required
- Total Beneficiaries
- 15,000+
- Success Rate
- 85%
- Average Disbursement
- ₹18 Lakhs
- Industries Covered
- All Sectors
- Processing Time
- 30-45 Days
- Interest Rate
- 11-13% p.a.
01Overview
About PMEGP
The Prime Minister's Employment Generation Programme (PMEGP) is a credit-linked subsidy programme administered by the Ministry of Micro, Small and Medium Enterprises (MoMSME). It aims to generate employment opportunities through establishment of micro enterprises in rural as well as urban areas.
PMEGP merges two schemes namely Prime Minister's Rojgar Yojana (PMRY) and Rural Employment Generation Programme (REGP) for generation of employment opportunities through establishment of micro enterprises in rural as well as urban areas.
Under this scheme, entrepreneurs can get loans ranging from ₹10 lakhs to ₹50 lakhs for manufacturing units and up to ₹20 lakhs for service units, with substantial government subsidy ranging from 15% to 35% of the project cost.
- 01
Manufacturing Units
Get up to ₹50 lakhs for setting up manufacturing units with modern machinery and equipment
- 02
Service Sector
Funding up to ₹20 lakhs for service sector businesses including IT, consultancy, and more
- 03
Rural Focus
Higher subsidy (35%) for units in rural areas to promote rural entrepreneurship
- 04
Special Categories
Extra benefits for Women, SC/ST, OBC, Minorities, Ex-servicemen, and differently-abled
- 05
No Collateral Required
Collateral-free loans make it accessible for first-time entrepreneurs
- 06
Business Expansion
Existing units can also apply for expansion with second loan facility
02Who can apply
Eligibility Criteria
Basic Eligibility
5 points- Individual above 18 years of age
- Minimum VIII standard pass for projects above ₹10 lakhs in manufacturing and ₹5 lakhs in service sector
- Self Help Groups, Charitable Trusts, Societies, and Production Co-operatives are also eligible
- Only new projects are considered for financing (Existing units not eligible for first loan)
- One person from one family can avail benefit (Family includes self and spouse)
Business Requirements
5 points- Project cost: ₹10 lakhs to ₹50 lakhs for manufacturing sector
- Project cost: ₹5 lakhs to ₹20 lakhs for service sector
- Business should be in manufacturing, processing, preservation, or service sector
- Should not be in the negative list (meat processing, liquor, tobacco products, etc.)
- Project should create employment opportunities
Special Category Benefits
5 points- Women entrepreneurs get priority and higher subsidy
- SC/ST/OBC/Minorities/Ex-servicemen get special category benefits
- Physically handicapped persons eligible for higher subsidy
- Hill and Border areas, NER, and J&K get additional benefits
- Aspirational districts identified by NITI Aayog get priority
03Paperwork
Required Documents
0 / 22 ready
Tick the documents you already have
Identity & Address Proof
Educational Documents
Project Documents
Special Category Documents
04Step by step
Application Process
- 01
Online Application
1-2 DaysApply online through PMEGP e-portal with all required documents and project details
Keep all documents ready
- 02
EDP Training
15-20 DaysComplete mandatory Entrepreneurship Development Programme (2-3 weeks duration)
Certificate required
- 03
Bank Processing
7-10 DaysBank scrutinizes application, conducts field visit, and processes for sanction
Field inspection mandatory
- 04
DLCC Approval
5-7 DaysDistrict Level Consultancy Committee reviews and approves the application
Monthly meeting
- 05
Sanction & Disbursement
7-10 DaysBank sanctions loan and government subsidy is credited to your account
Margin money required
- 06
Project Implementation
30-45 DaysPurchase machinery, set up unit, and start operations as per approved plan
Regular monitoring
05Why it's worth it
Key Benefits
Capital Subsidy
Get 15-35% subsidy on project cost directly credited to your account
- 35% for Rural Areas (General)
- 25% for Urban Areas (General)
- 5% extra for special categories
Collateral Free
No collateral or third-party guarantee required for loans
- 100% collateral-free
- No guarantor needed
- CGTMSE coverage available
Working Capital
Additional working capital support for smooth operations
- Up to 40% of project cost
- Cash credit facility
- Revolving fund support
Second Loan Facility
Existing PMEGP units can apply for expansion loan
- Up to ₹1 Crore funding
- 15-20% subsidy available
- For units with good track record
Subsidy Calculator
- Subsidy rate
- 35%
- Estimated subsidy
- ₹3,50,000
Capped at ₹17,50,000. Final subsidy depends on category, location and the sanctioning authority.
07Questions
Frequently Asked Questions
- Manufacturing units can get up to ₹50 lakhs (previously ₹25 lakhs, recently increased) and service units can get up to ₹20 lakhs (previously ₹10 lakhs). The project cost includes capital expenditure and one cycle of working capital.
- General category gets 25% subsidy in urban areas and 35% in rural areas. Special category (SC/ST/OBC/Minorities/Women/Ex-servicemen/Physically handicapped/NER/Hill and Border areas) gets 35% in urban and 35% in rural areas. The subsidy is directly credited to your bank account.
- No, PMEGP loans are completely collateral-free. No collateral security or third-party guarantee is required. The assets created out of the loan itself act as primary security.
- General category needs to contribute 10% of project cost as margin money, while special category needs only 5%. The remaining amount after subsidy is provided as bank loan.
- Existing units are not eligible for first PMEGP loan. However, units that have already availed PMEGP loan and have good repayment track record can apply for second loan for expansion up to ₹1 crore with 15-20% subsidy.
- Yes, Entrepreneurship Development Programme (EDP) training is mandatory for all PMEGP beneficiaries. It's a 2-3 week program that provides essential business skills and knowledge about running an enterprise.
- Activities in the negative list include meat processing, liquor/toddy manufacturing, tobacco products, crops/plantation, retail trade, and businesses with investment less than ₹50,000 (except for special areas).
- The typical timeline is 30-45 days from application to disbursement, provided all documents are in order and EDP training is completed. This includes application processing, DLCC approval, and bank sanction.
- PMEGP is primarily for unemployed youth. If you're employed, you'll need to provide an undertaking that you'll focus full-time on the business after loan sanction. Government employees are not eligible.
- Interest rates vary by bank but typically range from 11% to 13% per annum. Some banks offer concessional rates for women entrepreneurs and special categories. The rate depends on your credit profile and bank policies.
Plan your EMI before you apply
See the monthly instalment, the real cost of interest and how the balance falls, year by year.
EMI Planner
Drag the sliders — everything updates live
Monthly EMI
₹32,241
Total interest
₹4.34 L
Total payable
₹19.34 L
Principal 78%
Interest 22%
Every ₹1 borrowed costs ₹1.29 in total.
What you pay each year
Illustrative only. Your actual rate depends on the lender, scheme and your credit profile.
Real outcomes
Success Stories
“PMEGP helped me start my LED manufacturing unit. The 35% subsidy was a game-changer. SetuBridge Solutions made the entire process smooth and hassle-free.”
Rajesh KumarLED Manufacturing UnitFunded: ₹35 Lakhs“As a woman entrepreneur, I got priority processing and 35% subsidy. The team guided me through every step, from EDP training to loan disbursement.”
Priya SharmaOrganic Food ProcessingFunded: ₹25 Lakhs“The collateral-free loan under PMEGP enabled me to set up a modern printing press. The subsidy amount of ₹15.75 lakhs gave my business the perfect start.”
Mohammed AliPrinting PressFunded: ₹45 Lakhs
PMEGP
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