What You Need to Know About PMRY

PMRY or Prime Minister Rozgar Yojana is a scheme launched on 2 October 2019 with an aim to tackle unemployment prevailing amongst India’s educated youth. Pradhan Mantri Rozgar Yojana does this by providing subsidised financial aid to eligible youth seeking to set up an enterprise in the manufacturing, trade, business or service sector. 

At first, PMRY sought to create self-employment for over 1 million educated but unemployed youth over a span of 2 and a half years by setting up 7 lakh micro enterprises. On meeting with success, the Government made PMRY a permanent scheme, and today, you too can avail its benefits.

Read on to know about the PMRY scheme.

Features of Prime Minister Rozgar Yojana

• PMRY is a Centrally-sponsored scheme.

• PMRY covers projects costing up to Rs.1 lakh for the business sector, and Rs.2 lakh for other sectors. That said, the project cost can run up to Rs.10 lakh if two or more eligible persons get together to set up an enterprise in partnership.

• The subsidy offered can go up to 15% of the project cost, with a maximum of Rs.7,500 per entrepreneur.

• Banks can take, from the entrepreneur, margin money amounting to 5%-16.25% of the project cost.

• When added, the subsidy and the margin money should amount to 20% of the project cost.

• There is no collateral requirement for projects costing up to Rs.1 lakh. In case of a partnership, the exemption stands for an amount of Rs.1 lakh per person in the partnership.

• Normal interest rates are charged for loans availed through the PMRY scheme.

• Entrepreneurs can benefit from an initial moratorium period. After which, repayment can be made within 3 to 7 years.

• The implementing agencies include District Industry Centres and Directorates of Industries.

• Training expenses are to be covered within Rs.2,000, per case.

Eligibility criteria for Prime Minister Rozgar Yojana

To qualify for financial assistance through Pradhan Mantri Awas Yojana, you must meet certain criteria and they are as follows.

• Age: You should be between 18 and 35 years of age. However, do note that there is a relaxation of 10 years for ex-servicemen, women, physically handicapped, and the SC/ST category.

• Educational qualification: You should have passed standard VIII to obtain financing. Here, those trained a Government-recognised approved institution, in any trade, for at least 6 months, will be given preference.

• Family income: As a beneficiary, your annual income, along with that of your spouse, must not exceed Rs.40,000. Similarly, neither should your parent’s income exceed Rs.40,000 per annum.

• Residential qualification: You must be a permanent resident of the area for a minimum of 3 years.

• Loan history: You must not have defaulted on any loan offered by a bank, cooperative bank or financial institution in the past.

• Beneficiary status: You must not have availed assistance through any subsidy-linked Government scheme.

• Activities covered: You can avail assistance for any economically viable activity provided that they are not direct agricultural operations such as raising crops or purchasing manure.

• Reservations: Preference is given to women and weaker sections. Further, the PMRY scheme envisions a 22.5% reservation for SC/ST and a 27% reservation for OBCs.

Documents required to benefit from Pradhan Mantri Rozgar Yojana

The documents you must keep handy to benefit from PMRY include the following.

• Project proposal (copy)

• Proof of birth, such as birth or SSC certificate

• Income certificate

• Proof of being a resident of the area for 3 years, such as ration card or Aadhaar Card

• Educational and technical certificates

• Entrepreneurship Development Programme certificate

How to apply for a PMRY loan

The first step to applying for a Pradhan Mantri Rozgar Yojana loan is to prepare a project report based on the project idea. This report must contain details such as raw materials to be used, fixed assets, salary amounts, expenditures, the cost of production, a break-even analysis, profitability ratios, and so on. 

On finalising the project idea, you must fill out the application form and submit it, along with the required documents, to your local bank or your District Industry Centre (DIC). On thorough scrutiny of the application, you will be called for an interview. You may make an application at any time of the year.

Both banks and DICs assume major roles in implementing PMRY loan schemes and if you are an eligible entrepreneur, you can start preparing a project report and take steps to obtaining funding to setup a self-sustaining venture.