Subsidy

PMEGP

Prime Minister's Employment Generation Programme

Credit-linked subsidy of 15% to 35% for setting up new micro enterprises in manufacturing and services.

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Subsidy
15% to 35%
Project cost
Up to ₹50 Lakh
Own contribution
5% to 10%
Run by
KVIC, KVIB & DIC
Overview

About PMEGP

PMEGP is a flagship credit-linked subsidy programme of the Ministry of MSME for setting up new micro enterprises. The bank sanctions a loan for the project and the government provides margin money subsidy of 15% to 35% of the project cost.

The maximum project cost is ₹50 Lakh for manufacturing and ₹20 Lakh for service units. Existing PMEGP units with a good track record can also apply for a second loan for upgradation.

Key benefits

  • Urban general category: 15% subsidy
  • Rural general category: 25% subsidy
  • Special categories (SC/ST, OBC, women, minorities, ex-servicemen, divyang, NER): 25% urban, 35% rural
  • Balance of project cost funded by bank loan
  • Second loan available for upgradation of successful units

Who is eligible

  • Individual aged 18 or above
  • Minimum VIII pass for projects above ₹10 Lakh (manufacturing) or ₹5 Lakh (services)
  • Only new projects; existing units are not eligible for the first loan
  • SHGs, trusts, societies and production cooperatives can also apply
  • Units that have already availed a government subsidy are not eligible

Documents required

  • Aadhaar and PAN of the applicant
  • Detailed project report
  • Educational qualification certificate
  • Caste or special category certificate (if applicable)
  • Rural area certificate (for rural subsidy rate)
  • EDP training certificate before disbursement

How Vertex helps with PMEGP

  1. 1Eligibility checkWe review your business profile against the scheme rules and related state incentives.
  2. 2Documents & project reportWe prepare the DPR, financials and registrations such as Udyam, GST and FSSAI.
  3. 3Application & lender liaisonWe file the application and coordinate with banks, NBFCs and agencies.
  4. 4Sanction & follow-upWe follow up until sanction, disbursement and any subsidy release.

Frequently asked questions

Yes. Beneficiaries must complete an Entrepreneurship Development Programme (EDP) before the loan is disbursed.

The margin money subsidy is kept with the bank as a term deposit for 3 years and adjusted against the loan after the unit is verified as operational.

Scheme limits, subsidy rates and timelines are indicative and subject to the latest government guidelines and lender policies. Vertex Certification is a private consultancy and is not affiliated with any government body.

Related schemes

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PMFME

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Collateral-free loans up to ₹20 Lakh for small businesses in manufacturing, trading and services.

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CGTMSE

Collateral-free business loans for micro and small enterprises, backed by a government credit guarantee.

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