The programme is a hybrid of two programmes: the Prime Minister’s RojgarYojana and the Rural Employment Generation Program. The goal is to give continuous and sustainable employment to a broad section of the country’s traditional and potential craftsmen, rural and urban jobless youngsters. The initiative encourages financial institutions to participate in order to increase credit flow to micro-enterprises.The Prime Minister’s Employment Generation Programme (PMEGP) is a credit-linked subsidy programme launched by the Indian government in 2008. PMEGP is the result of the combination of two schemes: the Prime Minister’s RojgarYojna and the Rural Employment Generation Programme. This initiative aims to provide self-employment possibilities in the non-farm sector by assisting jobless youth and traditional craftspeople in establishing micro-enterprise firms.
The Prime Minister’s Employment Generation Programme is managed by the Ministry of MSME (PMEGP). The PMEGP Scheme is being administered at the national level by the Khadi and Village Industries Commission (KVIC). The Scheme is being implemented at the state level through State Khadi and Village Industries Commission Directorates, State Khadi and Village Industries Boards, District Industries Centres, and banks.
According to the Khadi and Village Industries Commission Act 2006 – Scheme, a rural area is defined as any village and includes any town. The population shall not exceed 20,000 people, or any other quantity specified by the Central Government from time to time. Only District Industries Centres (DIC) are included in the urban area.
a list of negative actions
The margin money contribution is 5% of the project cost for special category borrowers and 10% for general category borrowers. Illustration: If Miss Nishitha applies to XYZ bank for a loan of Rs 8 lakh, the bank may only finance 80% of the loan amount (i.e. Rs 6,40,000/-). The remaining 20% (Rs 1,60,000/-) is referred to as margin money, and Nishita must make provisions for it.
General Category: The qualifying subsidy is 25% of the project cost in rural regions and 15% in urban areas.
Special Category: The qualifying subsidy is 35% of the project cost in rural regions and 25% in urban areas.
Assume Mr. Don, a fresh new entrepreneur from Bangalore City, wishes to apply for the PMEGP scheme. Rs 10 lakh is the estimated project cost. Mr. Don’s Contribution (Required by the PMEGP) – Rs 1 lakh (10 percent of Rs 10 lakh) Mr. Don received a sum of Rs 9 lakh. Note: The margin money (i.e. 15% of the Project Cost – Rs 1,50,000/-) withheld by the bank would be returned to the bank by KVIC within 24 hours of the PMEGP application being accepted. As a result, entrepreneurs like Mr. Don may simply obtain the financing they need to move forward with their enterprise. Banks will fund capital expenditure with a term loan and operating capital with cash credit. Projects may also be funded.After deducting the (Margin Money) subsidy and the owner’s contribution, the bank credit will range between 60 and 75 percent of the cost. Though banks would claim subsidies based on capital expenditure forecasts in the project report, Margin Money can only be obtained based on actual capital expenditure, with any excess being repaid to KVIC. Working Capital should be used in such a way that it reaches 100 percent of the cash credit limit within three years of the margin money lock-in term and not less than 75 percent of the sanctioned maximum.
The normal interest rate is applicable to the enterprise from time to time. The Repayment Schedule ranges from 3 -7 years.
No collateral security nor any third party guarantee is insisted here. Any assets created from the bank loan should be hypothecated to Bank.
At the national level, KVIC is the nodal agency. The scheme will be implemented through Khadi and Village Industries Commission, Khadi and Village Industries Boards and DIC in both rural and urban areas.
A 2 weeks training period is mandatory for all the beneficiaries.
This Diwali, we present a portfolio that reflect both sector-specific and stock-specific opportunities. With 2…
Thank you for showing interest in taking a BTST position using our Delivery Plus product.…
Thank you for showing interest in the consultation on trading strategies!Our expert will reach out…
Even if you are a new participant in the stock market, the process of buying…
A company’s debt position can be gauged using the interest coverage ratio or ICR. This…
Muhurat Trading, a cherished tradition in the Indian stock market, takes place on Diwali, the…