Free PMEGP Loan & Subsidy Calculator (Estimate Tool)

The Prime Minister’s Employment Generation Programme (PMEGP) is a flagship credit-linked subsidy scheme introduced by the Government of India to encourage micro-enterprise setup across manufacturing and service sectors. Administered by the Khadi and Village Industries Commission (KVIC), the scheme provides financial assistance through participating commercial banks.

Under official PMEGP guidelines, project financial limits and promoter funding structures are defined as follows:

• Maximum Project Cost: Up to ₹50 Lakhs for Manufacturing units and up to ₹20 Lakhs for Service / Business sector projects.
• Promoter’s Own Contribution: 10% of total project cost for General Category applicants; reduced to 5% for Special Categories (including Women, SC/ST, OBC, Minorities, Ex-Servicemen, and Differently-Abled entrepreneurs).
• Government Subsidy (Margin Money): Ranges from 15% to 35% depending on location (Urban vs. Rural) and category type.

Use the interactive PMEGP loan calculator below to quickly estimate your mandatory promoter contribution, total government subsidy grant, and net bank loan requirement based on your location and sector choice.

How the PMEGP Bank Loan & Subsidy Lock-In Works

When your PMEGP application is sanctioned by the bank, the financial disbursement follows a specific credit structure rather than an immediate cash payout for the subsidy portion:

1. Initial Bank Loan Disbursement: The financing bank sanctions the full project cost minus your promoter contribution (i.e., Net Bank Finance = Project Cost − Own Contribution).
2. Margin Money Lock-In Deposit: The government subsidy amount is credited into a dedicated TDR (Term Deposit Receipt) account opened in your name at the financing bank branch.
3. 3-Year Lock-In Period: The subsidy amount is kept in a 3-year fixed deposit lock-in. No interest is charged on the portion of the bank loan equal to the subsidy amount during this period.
4. Final Adjustment: After 3 years of successful operation and verification of your unit, the subsidy deposit is credited directly against your loan account balance, effectively reducing your remaining loan principal.

Key Eligibility Criteria for PMEGP Loan Application

• Age Limit: Any individual above 18 years of age is eligible.
• Educational Qualification: At least VIII standard pass for manufacturing projects costing above ₹10 Lakhs and service projects costing above ₹5 Lakhs.
• New Projects Only: Financial assistance is strictly available for setting up fresh micro-enterprises. Existing units under other government subsidy schemes are not eligible.
• Institutions Eligible: Self Help Groups (SHGs), Charitable Trusts, and Co-operative Societies can also apply under specified guidelines.