Lok Sabha Question No. 4074 (UNSTARRED), answered on 2024-12-19
Subject: Improvement in PMEGP
Ministry: MICRO, SMALL AND MEDIUM ENTERPRISES
Asked by: Shri Jyotirmay Singh Mahato

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION No. 4074 TO BE ANSWERED ON 19.12.2024

## IMPROVEMENT IN PMEGP

4074. SHRI JYOTIRMAY SINGH MAHATO:

Will the Minister of MICRO, SMALL AND MEDIUM ENTERPRISES be pleased to state:

- (a) whether  there  is  any  plan  to  bring  improvements  in  the  Prime  Minister's  Employment Generation  Programme  (PMEGP)  particularly  in  respect  of  providing  financial  assistance  to  the applicants and facilitating the access to the benefit under the said scheme;
- (b) if so, the details thereof; and
- (c) if not, the reasons therefor?

## ANSWER

## MINISTER OF STATE FOR MICRO, SMALL AND MEDIUM ENTERPRISES (SUSHRI SHOBHA KARANDLAJE)

- (a) to (c): Government  has  taken  several steps for improvement  in  the Prime Minister's Employment  Generation  Programme  (PMEGP)  and  providing  financial  assistance  to  the  applicants and facilitating the access to the benefit under the scheme. The steps inter alia include:
- i. Enhancement of maximum project cost admissible from Rs. 25  Lakh to Rs. 50  Lakh for manufacturing sector and from Rs. 10 Lakh to Rs. 20 Lakh for service sector.
- ii. 2 nd financial assistance of upto Rs. 1 cr. is being provided for upgradation and expansion of well-performing existing PMEGP/MUDRA units with subsidy of 15% (20% for NER and hill and border areas).
- iii. COVID  years  i.e.,  FY2020-21  and  FY2021-22  have  been  exempted  while  considering profitability of existing PMEGP/ MUDRA units applying for 2 nd Loan under PMEGP.
- iv. Inclusion of applicants from Aspirational districts and transgenders under Special Category eligible for higher subsidy.
- v. Review  meetings  with  major  banks  are  organized  to  ensure  proper  loan  sanctioning  and margin money disbursement.
- vi. Technical and retired bank officials have been engaged by KVIC to provide handholding to the beneficiaries under PMEGP.
- vii. A  dedicated  Portal  for  tracking  the  complete  process  from  application  till  adjustment  of Margin Money subsidy into the beneficiary's loan account.

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- viii. Offline  applications  are  allowed  for  the  prospective  beneficiaries  who  are  not  acquainted with the online medium.
- ix. PMEGP applications from prospective beneficiaries in 11 regional languages since January 2024.

In addition, Reserve Bank of India has issued instructions to the banks for improving flow of credit to the MSME Sector including loans sanctioned under PMEGP which include:

- i. Priority Sector Lending: All bank loans to MSMEs qualify for classification under priority sector lending.
- ii. Collateral requirements of MSME units: Scheduled Commercial Banks have been mandated not to accept collateral security in the case of loans up to ₹10 lakh extended to units in the MSE sector.
- iii. Timeline for credit decisions: For loans up to ₹25 lakh to units in the MSE borrowers, banks are advised that the timelines for credit decisions shall not be more than 14 working days.

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