Prime Minister's Employment Generation Programme (PMEGP) — up to 35% subsidy for new enterprises
Government of India (Ministry of Micro, Small and Medium Enterprises)
Overview
A central scheme to create self-employment by helping people set up new micro-enterprises in rural and urban areas. Unemployed youth, artisans and traditional workers get a margin-money subsidy along with a bank loan.
The subsidy is 15%–25% of the project cost for general category applicants and 25%–35% for special categories (SC/ST/OBC/minorities/women/ex-servicemen/persons with disabilities and others). Projects can cost up to Rs 50 lakh for manufacturing and Rs 20 lakh for service/trading units. Your own contribution is only 5%–10%; the rest is a bank loan. Loans up to Rs 10 lakh (manufacturing) and Rs 5 lakh (service) are generally collateral-free.
Only new projects qualify; existing units are not eligible. There is no income ceiling. Apply on the PMEGP e-portal (pmegp.msme.gov.in); applications go to KVIC, the State Khadi Board or the District Industries Centre (DIC).
At a glance
- Administering authority
- Government of India (Ministry of Micro, Small and Medium Enterprises)
- Scheme type
- Business & Finance, Employment & Skills
- Place of posting / area
- All India
- Application mode
- Online
- Important dates
- Applications accepted year-round
Benefits
- Margin-money subsidy: 15%–25% for general category, 25%–35% for special categories
- Bank loan covering 90%–95% of project cost
- Own contribution: 5% for special categories, 10% for general category
- Maximum project cost: Rs 50 lakh (manufacturing), Rs 20 lakh (service/trading)
- Loans up to Rs 10 lakh (manufacturing) and Rs 5 lakh (service) generally collateral-free under CGTMSE
- Mandatory entrepreneurship development training (EDP)
Eligibility
- At least 18 years old
- Minimum Class VIII pass for projects above Rs 10 lakh in manufacturing and Rs 5 lakh in service/business
- Who can apply: individuals (rural and urban unemployed youth), self-help groups, institutions registered under the Societies Registration Act, production co-operative societies, charitable trusts
- New projects only; existing units are not eligible
- No income ceiling
- Manufacturing and service sector projects only
Excluded: units already receiving a subsidy under another government scheme; private limited companies and large enterprises are generally not eligible.
Priority goes to SC/ST/OBC, minorities, women, ex-servicemen, persons with disabilities and candidates from rural/hilly areas.
Required documents
- Aadhaar
- Age proof
- Educational qualification certificate
- Caste certificate (if applicable)
- Detailed project report (business plan)
How to apply
- On the PMEGP e-portal (pmegp.msme.gov.in), fill in the online form with personal, educational and project details
- Upload a detailed project report covering cost, type of activity and expected employment
- Upload Aadhaar, age proof, educational qualification, caste certificate (if applicable) and the project report
- The application is forwarded to KVIC, the State Khadi and Village Industries Board or the District Industries Centre (DIC)
- The authorities review it and may hold an interview or screening
Last updated: 1 Nov 2026
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