Simplified Procedure of PMEGP
Simplified Procedure of PMEGP
To accelerate project implementation under the Prime Minister’s Employment Generation Programme (PMEGP) when Covid-19 has impacted all sectors, the Ministry of Micro, Small and Medium Enterprises (MSME) has notified the Simplified Procedure of PMEGP. So far, the proposals for PMGEP were scrutinized by the District Level Task Force Committee (DLTFC), headed by the District Collectors, and forward them to banks for taking credit decisions. According to the amended guidelines, the PMEGP implementing agency – Khadi and Village Industries Commission (KVIC) will directly clear the proposals and applications of prospective entrepreneurs and forward the application to banks for processing the PMEGP loans.
Gist of Notification
In line with the impact of the pandemic on employment and entrepreneurship, the Ministry of MSME has modified the PMEGP Scheme Guidelines.
- As per the simplified procedure, the Ministry of MSME announced that the district-level recommendation of proposals/applications of PMEGP will be discontinued. The State or District level implementing agencies – Khadi and Village Industries Commission (KVIC), KVIB, DIC will scrutinize the PMGP application and forward the application to banks for processing the loans.
- KVIC in association with the Bankers Association of India will also develop a scoring sheet that will be uploaded on the PMEGP E-portal to allow entrepreneurs to check the status of the applications and to make the process transparent.
- Only the application scoring 60 marks and above will be sponsored to the Banks by the implementing agencies.
- The ministry also clarified that all PMEGP applications presently pending at the task force level will be withdrawn by the implementing agencies and forwarded to the banks immediately for processing loans.
Prime Minister’s Employment Generation Programme (PMEGP)
The Prime Minister’s Employment Generation Programme is a vital credit-linked subsidy scheme launched for generating employment opportunities by establishing micro-enterprises in urban and rural areas of India. The Khadi and Village Industries Commission (KVIC) is the single nodal agency for the implementation of the PMEGP.
Eligible Beneficiaries of PMEGP
Individuals above the age of 18 years, Self Help Groups (SHGs), Cooperative Societies involved in the production, and institutions which are registered under the Societies Registration Act are eligible for benefits under the PMEGP.
PMEGP Loan
Under PMEGP, loans about Rs.25 lakh is provided to manufacturing projects, and Rs.10 lakh is provided for the business and service sector.
Margin Money / Government Subsidy Details
The Khadi and Village Industries Commission (KVIC) subsidizes 15% to 35% of a project’s cost, based on the classification of the area where the project has been proposed.
| Sl.No | Categories of Beneficiaries |
Rate of Subsidy of project cost |
|
|
1 |
Area (location of project/unit) |
Urban |
Rural |
|
2 |
General Category |
15% |
25% |
|
3 |
Special (including SC / ST / OBC /Minorities/Women, Ex-servicemen, Physically handicapped, NER, Hill and Border areas etc. |
25% |
35% |
Component of Project Cost
Capital Expenditure Loan, one cycle of working capital, and 10% of the project cost as own contribution in case of General category and 5% of the project cost in case of weaker section.
Beneficiary’s Contribution
The detail of the amount to be deposited by the entrepreneur’s contribution is as follows:
| Sl.No | Categories of Beneficiaries | Beneficiary’s contribution of project cost |
|
1 |
General Category | 10% |
| 2 | Special (including SC / ST / OBC /Minorities/Women, Ex-servicemen, Physically handicapped, NER, Hill and Border areas etc. |
5% |
Financial Agencies Approved under PMEGP
The details of the financial agencies approved under the PMEGP are as follows:
- Regional Rural Banks (RRB)
- Co-operative Banks
- Public Sector Banks
- Private Scheduled Commercial Banks approved by respective State Task Force Committee
Pre-Requisite for PMEGP Loan
The entrepreneur needs to arrange the following documents before applying for PMEGP loan.
- KYC documents and PAN card
- A detailed project report
- All the supporting documents about entrepreneurs qualifications, Caste (for some special concessions), bank statements, arrangement of margin money, permissions
- Documents in support of the assets and liabilities if any be collected
- Necessary quotations for the assets to be purchased for the project implementation
- The most important aspect is to talk to your banker, obtain their willingness to consider the loan and then approach KVIC/nodal agencies
Simplified Procedure for Apply PMEGP
The amended guidelines to apply for the Prime Minister’s Employment Generation Programme (PMEGP) are as follows:
- The entrepreneur who wish to apply for PMEGP, need to access the official website of Prime Minister’s Employment Generation Programme.
- From the home page, select the ‘online application form for individual’ or ‘online application form for non-individual. The PMEGP online application will be displayed. Provide the following details in the application form:
- Aadhaar number of the applicant
- Name of Applicant: exactly as it appears in the Aadhaar Card.
- Select Agency – KVIC, KVIB, DIC to submit the application form (as per simplified procedure).
- Select State & District from the drop-down list
- Select District from the list
- Select Sponsoring Office from the list
- Select the Legal Type
- Gender: Select Gender and Date of Birth
-
- Select Social Category & Special Category of the applicant from the list
- Qualification and Address for Communication
- Select Unit Location (i.e. Rural OR Urban)
- Address of the Proposed Unit
- Select the type of activity from the drop-down list (i.e. Service or Manufacturing)
- Select Industry from the List of Industry and furnish the Product Description
- Details of EDP Training and If EDP Training Undergone enters Training Institute Name in detail.
- Details of Loan Required :
- Details of Bank
- After furnishing all necessary information in the appropriate field Click On the Save Applicant Data button to Save the Details.
- After “Save Applicant Data”, the entrepreneur needs to upload the above-mentioned documents for the final submission of the application.
- After the Final Submission, the Applicant ID and password will be sent to the registered mobile number.
Application Processing as per Revised Guidelines
As per the modified procedure of PMEGP, the state/District level implementing agencies such as Khadi and Village Industries Commission (KVIC), KVIB, and DIC will scrutinize the application preliminary; examine the personal and factual details mentioned in the application/project reports.
The KVIC after the preliminary appraisal of the application will forward the complete application directly to one of the financing banks opted by the applicant for taking credit decision along with a copy of Lead Bank Manager for information and monitoring.
Banks will examine the applications both technically and financially and sanction the application for loans as per the revised guidelines. To avail the Loan, the project should fulfil inter alia the criteria of the following:
- Industry
- Per capita investment
- Own Contribution
- Rural Areas (Projects sponsored by KVIC/KVIB/DIC)
- Negative List
The bank will send the sanction letter online to the applicant and implementing agencies. The sanction letter will also be automatically forwarded to the RESTI- authorized training centre for conduct PMEGP EDP training
PMEGP Scoring Sheet for Entrepreneur
As mentioned above, KVIC in consultation with the Bankers of Association will prepare a score sheet and upload that on the PMEGP e-Portal.
The Score sheet will enable the implementing agencies to scrutinize the application and forward the application to the banks based on the minimum prescribed marks score by the applicant.
The scoring sheet will enable the entrepreneur to judge his/her applications at the level and if the applicant is not up to the mark as per the prescribed score, the entrepreneur can improve the project and resubmit the application after making necessary changes.
The details of the Score Card are attached here for reference:
ScoreCardCircular-7-9Only the application scoring 60 marks and above will be sponsored to the Banks by the implementing agencies.
The application which does not score more than 60 marks out of 100 marks will be rejected with a valid reason.
Note: The applicant can file a grievance against such rejection to the State Director, KVIC.
Exemption of EDP Training for claiming Margin Money under PMEGP
As per the previous guidelines after loan disbursement, the entrepreneur needs to attend an EDP TRAINING for 15 days. Applicants whose PMEGP loan has been sanctioned and not completed online EDP training form any institute can apply for the training through the official website.
The Ministry of MSME has also notified that the applicant need not complete the EDP training for the claiming Margin Money under PMEGP. The financing bank will have to disburse the loan and claim/ upload margin money subsidy on PMEGP online portal without waiting for the completion of EDP training.
