MSMEPMEGP
Prime Minister's Employment Generation Programme (PMEGP)
Credit-linked subsidy scheme offering 15-35% subsidy on bank loans for starting new micro-enterprises. Max project cost: ₹50 lakh (manufacturing) and ₹20 lakh (services).
NOTICE
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Official fee
₹0 — completely free
Applying for PMEGP is free. The government pays you a margin-money subsidy — no one may charge you to apply, and you should never pay an agent an upfront 'file fee' to submit your application.
Beware of lookalike portals
Fraudsters run fake PMEGP 'loan approval' sites and demand processing charges to release the subsidy. The genuine application is only on the official KVIC e-portal, and you are never asked to pay before your loan and subsidy are sanctioned.
Only the "Apply on official portal" button above leads to the verified government site.
Highlights and Media
PMEGP Video Guide
Provided by Google NotebookLM
Key Highlights
High Subsidy Rate
Generous margin money subsidy of 15% to 35% depending on category and urban/rural location.
Scalable Funding
Supports projects up to ₹50 lakh for manufacturing and ₹20 lakh for service units.
CGTMSE Covered Loans
Bank loans under PMEGP can be backed by CGTMSE credit guarantee, meaning no collateral security is required.
Funding Breakdown (Special Category, Rural Unit)
Project cost distribution showing the borrower share, government subsidy, and bank loan portion
Only 5% of project cost is required as own contribution for Special category applicants (SC/ST/OBC/Women/Minority).
35% subsidy on project cost for special category units set up in rural areas.
The remaining 60% of project cost is financed as a bank term loan.
Who is eligible
- Funding need indicated for a new venture
- Persona suits a new non-farm micro-enterprise
- Eligible for margin-money subsidy with EDP training
Eligibility rules · v1 · effective 7 December 2023
Who is not eligible
- Add 'Get funding' to your goals to see PMEGP.
- PMEGP is designed for first-time founders, rural artisans, women, and SC/ST entrepreneurs starting new units.
- PMEGP is only open to applicants aged 18 and above.
Before you apply
Most rejections happen because of small data mismatches, not eligibility. Clear these checks first — each takes a few minutes and saves weeks.
Do you have an 8th-standard pass certificate if your project cost exceeds ₹10 lakh (manufacturing) or ₹5 lakh (services)?
PMEGP guidelines mandate a minimum educational qualification of 8th standard pass only for higher-value projects. Re-verify your project cost and keep your school certificate handy.
[BUSINESS_PLAN]
Is the proposed business a brand-new (greenfield) enterprise?
PMEGP is strictly for establishing new units. Existing or operational businesses are not eligible for the primary PMEGP loan.
[BUSINESS_PLAN]
How to apply
Register on the KVIC PMEGP e-portal
Create your applicant account with Aadhaar-based details.
Typical duration · 1 day
Fill the application and upload your project report
Enter the project cost, activity, and category, then attach documents.
Typical duration · 2 days
Submit for district-level scrutiny and bank referral
Your application is reviewed by KVIC/KVIB/DIC and forwarded to a financing bank.
Typical duration · 30 days
Attend EDP training and receive loan plus subsidy
Complete Entrepreneurship Development Programme training; the bank releases the loan with the margin-money subsidy.
Typical duration · 15 days
What to expect after applying
Decision typically in 30–60 days after you submit
After submitting online, the application goes to KVIC/KVIB/DIC for scrutiny and then to the bank branch. Sanction typically takes 4–8 weeks.
Common rejection reasons — and how to avoid them
Project is in the negative list of activities
How to avoid it: PMEGP has a list of prohibited businesses (e.g., meat processing, tobacco/alcohol products, transport vehicles). Ensure your business activity is eligible before applying.
Applying as an existing unit
How to avoid it: Ensure this is a new venture. If you already have an operational business, consider other MSME loan schemes like MUDRA or CGTMSE.
Sources
- KVIC — PMEGP e-PortalMINISTRY_PORTAL · Fetched 5 July 2026
- KVIC — Revised PMEGP Scheme Guidelines (07-12-2023)CIRCULAR · Fetched 5 July 2026
Additional Details
The Prime Minister's Employment Generation Programme (PMEGP) is a credit-linked subsidy scheme administered by the Ministry of Micro, Small and Medium Enterprises (MoMSME) and implemented by KVIC. The scheme helps individuals set up new micro-enterprises in the non-farm sector by providing a margin money subsidy alongside a bank loan.
Key features include:
- Project Limit: Up to ₹50 lakh for manufacturing and up to ₹20 lakh for services/trading.
- Subsidy Rate: 15% to 35% of the project cost depending on the applicant's category (General/Special) and location (Urban/Rural).
- Own Contribution: 10% for General category and 5% for Special categories.
- Security: Collateral-free loans are backed by the CGTMSE guarantee cover.
- Moratorium/Repayment: Moratorium as decided by the bank, with a repayment period of 3 to 7 years.
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