Prime Minister’s Employment Generation Programme (PMEGP) – A Step by Step Guide


Essentially a credit-linked subsidy scheme, PMEGP, was launched by the Government of India in 2008 to encourage employment generation.

PMEGP full form is Prime Minister’s Employment Generation Programme, and it is executed at National level by the Khadi and Village Industries Commission (KVIC). At the state level, the State KVIC Directorates, the Khadi and Village Industries Boards, the District Industries Centres and financial institutions are responsible for its implementation.

The scheme is said to be a compilation of the Prime Minister’s Rojgar Yojna and the Rural Employment Generation Programme. It aims at facilitating self-employment by encouraging micro-enterprise establishments by extending financial assistance. Such assistance is routed through designated banks in the form of PMEGP loan.

Eligibility Criteria for PMEGP

Units that are yet to be established can avail assistance under this scheme.

Besides that, any individual or units who would meet these criteria would be deemed eligible.

  • 18 years old or above.
  • Must have passed standard VIII to avail assistance for a project worth over Rs. 10 Lakh in the manufacturing sector.
  • Must have passed standard VIII to avail assistance for a project worth over Rs. 5 Lakh in the service sector.

Other eligibility criteria –

  • Cooperative societies which are production-based.
  • Charitable trusts.
  • Self-help groups.
  • Institutions that are registered under The Societies Registration Act, 1860.

However, individuals who have availed subsidy under any existing state or central government subsidy scheme would not be deemed eligible for applying to PMEGP. Other than that, individuals must also ensure that their intended business venture does not belong to the list of activities that are deemed negative under the scheme.

If any individual who fails to fulfil the eligibility criteria of PMEGP Scheme, they can avail a business loan from any financial institutions to generate self-employment opportunities.

Application procedure

Individuals can apply for PMEGP, both online and offline.

Individuals applying offline would need to accept the application invitation extended by the State or Divisional Directors of the KVIC or DICs through print or electronic advertisement. They need to submit their project proposal along with their application form.

Those who plan to apply online would be required to visit the website and click on either ‘PMEGP ePortal’ or ‘Prime Minister Employment Generation Programme’.

Next, they need to select ‘Online Application Form for Individual’ and offer all the essential details asked. All the details offered should tally with that mentioned in the documents and must be valid. Once all the details are filled in, individuals would need to click ‘Submit’ and complete the application procedure for the Prime Minister’s Employment Generation Programme.

Individuals should make it a point to print their application and send its copy along with their project proposal to respective authorities of the PMEGP scheme.

Subsidy benefit

Individuals who intend on availing the assistance of any of the Government business loan scheme in India should find out about the subsidy and margin involved. This pointer should serve as a vital tip to expand their manufacturing business.

The subsidy extended by PMEGP scheme –

  • For General Category – 15% of the total cost of the project, if based in urban areas and 25% of the total cost of the project, if based in rural areas.
  • For Special Category – 25% of the total cost of the project, if based in urban areas and 35% if based in rural areas. 

Individuals must learn what are the benefits of MSME loan scheme and check PMEGP loan details to be better equipped for availing a subsidy under the scheme. Additionally, before applying for the scheme, individuals must ensure that they possess all the documents that are deemed essential under it.


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