How much subsidy does PMEGP give?

General category: 15% of the project cost in a town or city, 25% in a rural area, and you put in 10%. Special category (women, SC, ST, OBC, minority, ex-servicemen, divyang and transgender applicants, and units in the North East, hill and border areas and aspirational districts): 25% in a town or city, 35% rural, and you put in 5%.

What is the largest project PMEGP will fund?

₹50 lakh for manufacturing, and ₹20 lakh for a service or trading project. Land is not counted in the project cost.

Is there an education requirement for PMEGP?

Only for larger projects: above ₹10 lakh in manufacturing, or above ₹5 lakh in services or trading, you must have passed Class 8.

Can I get PMEGP for a business I already run?

No. PMEGP funds new units only, and not a unit that already received a subsidy under another government scheme.

Does PMEGP cover trading?

Yes, at the service limit of ₹20 lakh, but each state may spend at most 10% of its yearly PMEGP money on trading, so places can run out.

Government loan schemes

PMEGP loan and subsidy

A bank loan for a new unit with a government subsidy of 15% to 35% of the project cost, for projects up to ₹50 lakh in manufacturing and ₹20 lakh in services or trading.

Check if you qualify, free ↓

Largest project: ₹50 lakh manufacturing, ₹20 lakh services or trading
Subsidy, general category: 15% in a town or city, 25% rural
Subsidy, special category: 25% in a town or city, 35% rural
Your own contribution: 10% general, 5% special category
Education: Class 8 passed, above ₹10 lakh (manufacturing) or ₹5 lakh (services, trading)

Who can apply

Anyone over 18 setting up a new unit. There is no income limit; one person per family.
Manufacturing projects up to ₹50 lakh; service and trading projects up to ₹20 lakh.
Above ₹10 lakh in manufacturing, or ₹5 lakh in services or trading, you must have passed Class 8.
Trading, within a limit: each state may spend at most 10% of its yearly PMEGP money on trading projects.
The special category, with the higher subsidy: women, SC, ST, OBC, minority, ex-servicemen, divyang and transgender applicants, and units in the North East, hill and border areas and aspirational districts.

Not open to

An existing business, or a unit that already received a subsidy under another government scheme.
A project with no capital spending. Land does not count toward the project cost.
Activities on PMEGP's negative list, such as meat, intoxicants, tobacco and restricted plastic products.

What you get

A bank loan for the project, and a subsidy (margin money) of 15% to 35% of the project cost, depending on your category and where the unit is. You put in 5% to 10%, and the bank lends the rest.

Examples

What the scheme rules say for a few typical cases. The checker below runs the same rules on yours.

₹8 lakh tailoring unit in a village, woman founder, Class 8 passedOpen
Yes, as a subsidy on a new unit. A subsidy of 35% of the project cost, about ₹2.8 lakh (special category, rural); you put in 5%.
₹30 lakh food processing unit in a city, general category, Class 8 passedOpen
Yes, as a subsidy on a new unit. A subsidy of 15% of the project cost, about ₹4.5 lakh (general category, urban); you put in 10%.
₹15 lakh service project, founder did not pass Class 8Not open
Needs Class 8 passed at this project size.
₹10 lakh to expand a business already runningNot open
Only for new units.
₹4 lakh new grocery shop in a townDepends
Likely, depending on the points below. A subsidy of 15% of the project cost, about ₹60,000 (general category, urban); you put in 10%.

How to apply

Write a project report: what the unit will make or do, the machinery, the working capital and the total cost.
Apply online on the PMEGP portal, pmegp.msme.gov.in.
KVIC, the state KVIB or the District Industries Centre checks the application and sends it to a bank, which decides the loan.

Check if you qualify

A few questions about you and the business. You will see PMEGP loan and subsidy first, and the other schemes beside it.

Questions people ask

How much subsidy does PMEGP give?: General category: 15% of the project cost in a town or city, 25% in a rural area, and you put in 10%. Special category (women, SC, ST, OBC, minority, ex-servicemen, divyang and transgender applicants, and units in the North East, hill and border areas and aspirational districts): 25% in a town or city, 35% rural, and you put in 5%.
What is the largest project PMEGP will fund?: ₹50 lakh for manufacturing, and ₹20 lakh for a service or trading project. Land is not counted in the project cost.
Is there an education requirement for PMEGP?: Only for larger projects: above ₹10 lakh in manufacturing, or above ₹5 lakh in services or trading, you must have passed Class 8.
Can I get PMEGP for a business I already run?: No. PMEGP funds new units only, and not a unit that already received a subsidy under another government scheme.
Does PMEGP cover trading?: Yes, at the service limit of ₹20 lakh, but each state may spend at most 10% of its yearly PMEGP money on trading, so places can run out.

From the scheme's official page, checked on 9 November 2026. Rules change; the bank still decides each loan.