Benefits of PMEGP:
Subsidy on bank loan ranges from 15% to 35% for projects up to 50 lakhs in manufacturing and 20 lakh in the service sector.
For Women / SC / ST / PH / minorities / Ex-servicemen / NER the margin money subsidy is 35% in rural area and 25% in urban areas.
Loan Details:
Banks sanction up to 90% to 95% of a project cost in special category. On this government provides 15%-35% as PMEG subsidy. The remaining money is provided by bank as term loan.
Subsidy given shall be kept in the form of FD with the bank. No interest shall be paid on such deposit.
3 years later after receiving adjustment letter from government, bank can adjust subsidy from loan.
Contribution:
Categories of Beneficiaries | Beneficiary’ Contribution |
| Rate Of Subsidiary | |
| New unit | Existing unit | Urban | Rural |
General Category | 10% | 10% | 15% | 25% |
Special Category | 5% | 10% | 25% | 35% |
Who Falls Under the Special Category?
Women: Female entrepreneurs above 18 years of age.
Scheduled Castes (SCs): Persons belonging to any of the communities recognized as Scheduled Castes in the Constitution of India.
Scheduled Tribes (STs): Persons belonging to any of the communities recognized as Scheduled Tribes in the Constitution of India.
Other Backward Classes (OBCs): Persons belonging to any of the communities notified as Other Backward Classes by the Central Government or the concerned State Government.
Minorities: Individuals belonging to any of the six minority communities (Muslims, Christians, Sikhs, Buddhists, Parsis, and Jains) as notified by the Central Government.
Ex-servicemen: Individuals who have served in the Indian Armed Forces (Army, Navy, Air Force) and have been honorably discharged.
Physically handicapped: Individuals with a disability of 40% or more as certified by a competent medical authority.
Northeastern Region (NER): Individuals residing in the states of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, and Tripura.
Hill and Border areas: Individuals residing in designated hill and border areas across India.
Aspirational Districts: Individuals residing in districts identified as Aspirational Districts by the NITI Aayog.
Conditions on 2nd loan:
Subsidy of 15% shall be given on 2nd loan of existing business which used PMEGP, on the condition that:
- First loan is prepaid successfully.
- Good profits, sales in last 3 years
- Good potential
- Previous subsidy successfully adjusted.
Project Cost:
| NEW UNIT | EXISTING UNIT |
Manufacturer | Rs. 50 lakhs | Rs. 1 crore |
Service | Rs. 20 lakhs | Rs. 25 lakhs |
- The cost of land is not included in the project cost.
- Project without capital expenditure is not eligible.
- Working capital is not to be more than 40% of project cost for manufacturing and 60% for service as service industry do not have much capex expenditure.
To know more about th Scheme, you can visit PMEGB e portal.
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