Money for your businessLoan with subsidy
PMEGP (Prime Minister's Employment Generation Programme)
A bank loan with a government subsidy of 15–35% of the project cost, for new manufacturing and service units. Run by KVIC.
PMEGP was approved up to FY 2025-26. Check on the KVIC PMEGP portal that applications are open before you plan around the subsidy.
| Applicant | Own money | Subsidy (urban) | Subsidy (rural) |
|---|---|---|---|
| General | 10% | 15% | 25% |
| Special category | 5% | 25% | 35% |
Special category: SC, ST, OBC, minorities, women, ex-servicemen, transgender persons, persons with disabilities, NER, hill and border areas, and aspirational districts.
Maximum project cost: ₹50 lakh for manufacturing and ₹20 lakh for service units. Applicants must be at least 8th pass for manufacturing projects above ₹10 lakh and service projects above ₹5 lakh.
- Only for NEW units. Existing businesses and units that already got a government subsidy are not eligible.
- Applicant must be 18 or older. One unit per family.
- The subsidy (margin money) is kept as a 3-year fixed deposit by the bank. No interest is charged on that part of the loan, and it is adjusted against the loan after 3 years if the unit is running.
- Land cost is not part of the project cost.
- Entrepreneurship Development Programme (EDP) training is required before the loan is released.
- Some activities are on a negative list (e.g. meat processing, tobacco, liquor). Some trading activities are not covered.
PMEGP subsidy calculator
| Your contribution | ₹50,000 (10%) |
| Bank loan sanctioned | ₹4,50,000 |
| Subsidy (margin money) | ₹75,000 (15%) |
| Interest-bearing loan | ₹3,75,000 |
| EMI at 10.5% | ₹8,744 |
EMI over 5 years including a 6-month moratorium. Your bank sets the actual rate and terms.
How to apply
- Pick the business and make a project report with real machinery quotations.
- Get Udyam registration (free) and keep Aadhaar, PAN, address proof, photos and bank statements ready.
- Apply online on the KVIC PMEGP e-portal and choose your bank branch.
- The district task force interviews you and forwards the application to the bank.
- After sanction, complete the EDP training; then the loan and subsidy are released.
Businesses and their loan amounts
*General category, urban. Special category in rural areas gets up to 35%.
Rules as of October 2026.