PM Employment Generation Program

PM Employment Generation Program, affectionately known as PMEGP, is a government initiative aimed at creating job opportunities for people across India. The Khadi and Village Industries Commission (KVIC) manages it, serving as the main coordinating body at the national level under the Ministry of Micro, Small & Medium Enterprises (MSME). KVIC ensures the smooth implementation of the scheme. At the state level, various bodies such as State KVIC Directorates, State Khadi and Village Industries Boards (KVIBs), District Industries Centers (DICs), and banks collaborate to make PMEGP a success story in empowering local communities and fostering entrepreneurship.

What is PM Employment Generation Program?

The Prime Minister’s Employment Generation Programme (PMEGP) is a centrally sponsored scheme. It is implemented by the Ministry of Micro, Small and Medium Enterprises (MSME). Aims to generate employment opportunities in rural and urban areas of the country. It assists in the setting up of new self-employment ventures/projects/micro enterprises.

Objectives of PM Employment Generation Program Scheme

Employment Generation Opportunities: Helping both urban and rural unemployed individuals by starting new small businesses and self-employment projects. Bringing together young people without jobs and traditional artisans, and offering them self-employment opportunities nearby.

Generation of mass employment in different sectors: To provide meaningful jobs for both traditional artisans and unemployed youth in rural and urban areas, curbing migration to cities. This will help artisans earn better wages and create more jobs in both settings.

Components of PMEGP Scheme

The PMEGP provides crucial financial aid to aspiring entrepreneurs.
Urban beneficiaries receive 15% of the project cost as a subsidy, while rural counterparts enjoy a higher margin of 25%.
For groups like SC/ST/OBC/Minorities/Women, Ex-Servicemen, Physically disabled folks, those from North Eastern Region (NER), and hilly areas, the subsidy is bigger, at 25% in cities and 35% in rural areas. They only need to contribute 5% personally.
PMEGP plays a pivotal role in creating sustainable employment. The units established through this program generate employment opportunities consistently throughout the year, contributing significantly to long-term job creation.

Features of PMEGP Scheme

In manufacturing, projects can spend up to 25 lakhs, while in business/services, it’s capped at 10 lakhs.
Subsidy rates depend on the location and beneficiary category. For those in the general category, living in urban areas, the subsidy rate is 15%. In rural areas, it’s 25%, and for special rural areas, it’s 35%.
Certain groups like SC/ST/OBC/Minorities/Women, Ex-servicemen, Physically disabled, and regions such as the North Eastern Region (NER), Hill, and Border areas get a higher subsidy of 25% for urban areas and 35% for rural areas.
Banks will cover the remaining project costs through term loans and working capital.

Significance of PMEGP Scheme

The PMEGP scheme has opened up new opportunities for small businesses to thrive and grow.
Since its inception in 2008–09, around 780,000 micro-enterprises have received support totaling Rs 19,995 crore under the Prime Minister’s Employment Generation Program.
This support has led to the creation of an estimated 6.4 million sustainable jobs across various sectors.
Notably, individuals from marginalized groups such as SC, ST, and women own almost half of the supported units, with about 80% of them situated in rural areas.
The PMEGP program is instrumental in enhancing the nation’s economic landscape by fostering the growth of MSMEs and improving overall employment opportunities.
It serves as a vital livelihood improvement initiative, empowering the economically disadvantaged to access capital and break free from traditional financing barriers.
Over the next five fiscal years, we project to create sustainable employment opportunities for approximately 4 million individuals.

Benefits of the PMEGP Scheme

PMEGP offers financial aid of up to Rs. 25 lakh for individuals looking to either start a new business venture or expand an existing one.
Subsidies are provided by the government to support these endeavors, covering 35% of the project costs for new enterprises and 25% for those already established.
Entrepreneurs benefit from collateral-free loans under PMEGP, eliminating the need to pledge any assets as security.
PMEGP offers thorough training programs, giving entrepreneurs vital skills in marketing, accounting, and taxation for better business management.
We provide marketing assistance to PMEGP beneficiaries, helping them promote and sell their products or services successfully.
PMEGP teams up with government agencies like KVIC to give entrepreneurs extra help with their businesses.