Loan
Business Loan: Upto Rs 25 lakh Loan at 35% subsidy Under This Scheme || PMEGP Loan Apply Process

Business Loan: The Prime Minister’s Employment Generation Programme (PMEGP) is a credit-linked subsidy scheme launched by the Government of India to promote entrepreneurship and generate employment in rural and urban areas. Administered by the Ministry of Micro, Small, and Medium Enterprises (MSME), the PMEGP scheme provides financial assistance to individuals and small businesses to set up new enterprises in various sectors.
If you’re planning to start your own business or expand an existing one, the PMEGP loan can be a valuable financial resource. This article explains everything you need to know about the PMEGP loan and how to apply for it.
What is a PMEGP Loan?
The Prime Minister’s Employment Generation Programme (PMEGP) is a government-backed credit-linked subsidy scheme launched in India to promote self-employment opportunities and entrepreneurship. Administered by the Ministry of Micro, Small and Medium Enterprises (MSME), it is implemented through organizations like the Khadi and Village Industries Commission (KVIC), State KVIC Boards, and District Industries Centres (DICs).
The PMEGP loan aims to provide financial assistance for the establishment of new micro-enterprises or projects in the manufacturing, service, and trade sectors. It primarily targets unemployed youth, aspiring entrepreneurs, and traditional artisans in rural and urban areas. Under the scheme, eligible beneficiaries can secure a bank loan for their project, with a government subsidy ranging from 15% to 35% of the project cost, depending on location and the applicant’s category.

The maximum project cost allowed is 25 lakh INR for manufacturing units and 10 lakh INR for service units. Beneficiaries must contribute 5% to 10% of the project cost, while the remaining amount is provided as a term loan by banks. This initiative not only generates employment at the grassroots level but also boosts rural industries and sustainable economic development. Applicants must meet specific criteria, including age, educational qualifications, and adherence to the project’s scope, to avail of the benefits.
Eligibility For PMEGP Loan
- Individuals aged 18 years or above.
- At least 8th-grade pass is required for projects costing more than 10 lakh INR in the manufacturing sector and 5 lakh INR in the service sector.
- Self-help groups (SHGs), charitable trusts, and production cooperatives are also eligible.
Key Point Of PMEGP Loan
- Manufacturing Sector: Up to 25 lakh INR.
- Service Sector: Up to 10 lakh INR.
- General Category Subsidy: 15% (urban areas) and 25% (rural areas).
- Special Categories Subsidy (SC/ST/OBC, women, physically challenged, etc.): 25% (urban areas) and 35% (rural areas).
- Repayment Period: Ranges from 3 to 7 years.
How to Apply for PMEGP Loan?
To avail of a PMEGP loan, you need to follow a systematic application process. Here’s a step-by-step guide:
1. Check Your Eligibility
Before applying, ensure you meet the eligibility criteria, such as age, educational qualifications, and the nature of the business.
2. Prepare a Business Plan
Draft a detailed project report outlining your business idea, investment requirements, expected returns, and other relevant details. A well-structured business plan is crucial for loan approval.
3. Register Online
Visit the official PMEGP e-portal at www.kviconline.gov.in and:
- Register as a new user.
- Fill out the application form with personal and business details.
- Upload the required documents.
4. Submit Required Documents
Key documents include:
- Identity proof (Aadhaar card, PAN card).
- Address proof.
- Caste or category certificate (if applicable).
- Business plan/project report.
- Educational qualification certificates.
- Bank account details.
5. Screening and Approval
- After submission, your application is forwarded to the District Industries Centre (DIC) or the implementing agency for verification.
- Once approved, the application is sent to the associated bank for loan processing.
Benefits of the PMEGP Loan
- Financial Assistance: Provides funding for starting or expanding small-scale businesses.
- Subsidy Support: Reduces the financial burden by offering a significant subsidy.
- Employment Generation: Promotes job creation in rural and urban areas.
- Encourages Entrepreneurship: Supports individuals with innovative business ideas.
- Focus on Underprivileged Sections: Higher subsidy rates for women, SC/ST, and other disadvantaged groups.
Tips for a Successful PMEGP Loan Application
- Choose a Feasible Business Idea: Ensure your business idea is viable and aligns with the scheme’s objectives.
- Prepare a Strong Business Plan: A detailed and realistic project report increases your chances of approval.
- Keep Documents Ready: Ensure all required documents are accurate and updated.
- Follow Up: Regularly track your application status and stay in touch with the implementing agency and bank.
Conclusion
The PMEGP loan scheme is a powerful initiative aimed at empowering entrepreneurs and boosting economic development across India. By offering financial assistance and subsidies, it enables individuals to turn their business ideas into reality. If you have an innovative idea and are looking for funding, the PMEGP loan can be your stepping stone to success.

Take the first step by registering on the PMEGP portal and preparing a strong business plan. With proper planning and execution, you can unlock the potential of this scheme to achieve your entrepreneurial dreams.
