Pradhan Mantri Rojgar Yojana

The Government of India launched Pradhan Mantri Rozgar Yojana (PMRY) in August 1993 to provide self-employment opportunities to educated unemployed youth. Through the scheme, the government promotes entrepreneurship among youth by offering financial assistance to individuals who wish to start their own ventures. In addition to the financial support, necessary training is offered to help young entrepreneurs manage their ventures.

Some of the key features of the scheme are as follows: 

• Activities Covered: The scheme supports all viable economic activities, including agriculture and allied sectors, but excludes direct farming operations like crop cultivation or manure purchase. 

• Project Cost: The maximum project cost is ₹1 Lakh for business activities and ₹2 Lakhs for other sectors. In partnerships, projects up to ₹10 lakhs are allowed, but assistance remains limited to individual eligibility. 

• Subsidy and Margin Money: Beneficiaries receive a subsidy of 15% of project cost, capped at ₹7,500 per person. Banks may collect 5%–16.25% margin money so that subsidy plus margin equals 20% of project cost. 

• Collateral: No collateral is required for loans up to ₹1 Lakh. In partnership ventures, this exemption is also limited to ₹1 lakh per participant. 

• Interest and Repayment: Normal bank lending rates apply, with repayment periods ranging from 3 to 7 years. An initial moratorium may be provided to ease repayment. 

• Training Support: Training and operational costs of up to ₹2,000 per case are covered under the scheme. 

• Implementing Agencies: District Industries Centres and State Directorates of Industries implement PMRY, in collaboration with banks. 

• Target Linkages: Annual targets are based on population and unemployed youth. Additional allocations depend on recovery rates and state performance. 

• Reservation: Preference is given to weaker sections, with 22.5% reserved for SC/ST and 27% for OBCs. Women candidates also receive priority consideration.

To apply for a loan under the PMRY scheme, you need to meet the following eligibility requirements: 

• You should be between the age of 18-35 years (40 for North-Eastern States)

• Relaxation of 10 years for SC/STs, physically handicapped, ex-servicemen, and women applicants is provided 

• You should have cleared the 8th standard exam

• The total of your income combined with your spouse’s or your parent's income should not exceed ₹40,000 per annum 

• You should be a permanent resident of the area for at least 3 years

• You should not be a defaulter for any financial institution or a beneficiary of other government-linked schemes

Along with meeting the above eligibility parameters, you will have to submit the following documents when applying for the scheme: 

• Application form with photographs

• Proof of identity – PAN card, Aadhaar card, driver’s licence, passport

• Proof of age – birth certificate or other accepted documents

• Proof of income issued by the MRO (Mandal Revenue Officer)

• Proof of residence – Ration card or other accepted documents

• Education Proof

• Profile of the proposed project

• Caste certificate issued by MRO, if required

• EDP (Entrepreneurship Development Programme) Certificated

• An affidavit signed by the notary officer

• Other documents, as requested by the lender

Here is an overview of the implementing agencies of the Pradhan Mantri Rozgar Yojana:

• The Development Commissioner (Small-Scale Industries) under the Ministry of Small Scale, Rural and Agro, Industries Government of India is the apex body

• The implementation of the scheme at the State level, except for 4 metropolitan cities, is under the respective Commissioner/Director of Industries

• In the metropolitan cities, Small Industries Service Institute (SISI) implements the scheme

• DCSSI formulates the regulations, rules, and guidelines and offers clarification on matters about the PMRY scheme

• DCSSI is also responsible for monitoring the progress of the scheme

• On a state level, the State Level PMRY Committee is responsible for monitoring the progress

To apply for a loan under the PMRY scheme, follow these steps:

• Step 1: Visit the official website at https://dcmsme.gov.in

• Step 2: Fill in the application form with the necessary details

• Step 3: Submit this form at a PMRY-registered bank or to the local DIC. 

• Step 4: Appear for the interview after your application is reviewed

After the interview, the relevant authorities will shortlist the candidates they consider to have the required PMRY loan eligibility as per the scheme details.

The bank expects you to start the repayment process once the business unit begins commercial production. Usually, banks set the repayment schedule, which can range between 3-7 years. 

It is important to remember that the loan, including interest, must be repaid on time. In case of default, the bank, along with the District Industries Centre (DIC), can recover the outstanding amount with the help of the Revenue and Police Departments. 

Efforts are also being made to include this loan under the Revenue Recovery Act, similar to the CMEY program. Therefore, you should make timely repayments to avoid issues.