About PMEGP

• Prime Minister’s Employment Generation Programme (PMEGP) is a central sector scheme administered by the Ministry of Micro, Small and Medium Enterprises since 2008-09.
• It is a major credit-linked subsidy programme aimed at assisting first generation entrepreneurs for setting up micro enterprises in the non-farm sector by helping traditional artisans and unemployed youth.
• At the national level, the Scheme is being implemented by Khadi and Village Industries Commission (KVIC), a statutory organization under the administrative control of the Ministry of MSME, as the single nodal agency.
• At the State level, the Scheme will be implemented through State KVIC Directorates, State Khadi and Village Industries Boards (KVIBs) and District Industries Centres (DICs) and banks.
• Under the scheme, loans are being provided by all Public Sector Banks, selected Private Sector Banks and Co-operative Banks with margin money subsidy (refers to the amount that the government contributes to beneficiaries availing PMEGP loan) being given by the Ministry of MSME through KVIC.

Scope

• The scheme is applicable to all viable projects in rural as well as urban areas, under the Micro enterprises sector.
• The maximum cost of the project admissible under the manufacturing sector is Rs.25 lakhs and the business/services sector is Rs.10 lakhs.
• Only one person from a family is eligible for obtaining financial assistance under the scheme.
• Assistance under the Scheme is available only for new projects.

Eligible Entrepreneurs / Borrowers

• Any individual, above 18 years of age
• The beneficiaries should have passed at least VIII standard, for setting up of project costing above Rs.10 lacs in the Manufacturing Sector and above Rs. 5 lacs in the business /Service Sector,
• Self Help Groups 
• Institutions registered under Societies Registration Act, 1860
• Production Co-operative Societies
• Charitable Trusts

Why in News?

• Since its inception in 2008-09, about 7.8 lakh micro enterprises have been assisted under the Prime Minister’s Employment Generation Programme with a subsidy of Rs 19,995 Crore generating estimated sustainable employment for 64 lakh persons. 
• About 80% of the units assisted are in rural areas and about 50% units are owned by SC, ST and women categories.
• The PMEGP has now been approved for continuation over the 15th Finance Commission Cycle for five years from 2021-22 to 2025-26 with an outlay of Rs.13554.42 Crore. 
• Following major modifications/improvements have been made in the existing Scheme:
  • Increasing the maximum project cost from existing Rs.25 lakh to Rs. 50 lakh for manufacturing units and from existing Rs.10 lakh to Rs.20 lakh for service units.
  • Modify definition of village industry and Rural Area for PMEGP. Areas falling under Panchayti Raj institutions to be accounted under rural area, where as areas under Municipality to be treated as urban area.
  • PMEGP applicants under aspirational districts and transgender will be treated as Special category applicants and entitled for higher subsidy.
  • States/districts covered: All the States/UTs will be covered under the Scheme.
  • Higher rate of Margin Money subsidy – 25% of the project cost in urban area and 35% of the project cost in rural areas, for special category applicants including, SC, ST, OBC, women, Transgender, Physically Disabled, NER, Aspirational and Border district applicants. For General category applicants subsidy is 15% of the project cost in urban area and 25% of the project cost in rural areas.

Reference

https://pib.gov.in/PressReleasePage.aspx?PRID=1829437