New Delhi: The Prime Minister’s Employment Generation Programme (PMEGP) assisted a large share of small micro-enterprises over the last five years, with 63 percent of supported units in the manufacturing sector and 93 percent in the service sector having project costs of up to ₹10 lakh, the government informed the Rajya Sabha on Monday.
The data covers the period from FY 2020–21 to FY 2024–25 and was shared by Minister of State for Micro, Small and Medium Enterprises Shobha Karandlaje in a written reply to a question in the Upper House.
PMEGP is a central sector scheme that supports beneficiaries in setting up new micro-enterprises, primarily through small loans and margin money subsidy. According to the ministry, priority is being accorded to applications involving project costs below ₹10 lakh.
The minister said banks have been instructed to strictly follow Reserve Bank of India guidelines, which state that no collateral security should be insisted upon for loans up to ₹10 lakh under the scheme. The ministry has reiterated this requirement to all major banks.
She also informed the House that there is no requirement for any educational qualification for setting up manufacturing projects costing up to ₹10 lakh and service sector projects costing up to ₹5 lakh under PMEGP.
To address grievances and provide handholding support, the MSME Ministry operates the CHAMPIONS portal, an integrated platform for grievance redressal, guidance on government schemes, and coordination with state governments, banks, and other agencies.
On interest rates, the minister said that lending rates for PMEGP loans are determined by individual banks within the regulatory framework prescribed by RBI, as interest rates on bank advances have been deregulated. RBI has issued directions to ensure transparency, fairness, and proper disclosure of loan terms to beneficiaries, and to prevent arbitrary recovery of interest.
