According to the Centre for Monitoring Indian Economy, the unemployment rate remained high at 10.07% as of June 2021. However, the Government has always implemented effective schemes to combat issues like unemployment. One such scheme is Pradhan Mantri Rozgar Yojana.
It was launched in 1993 to offer subsidised financial assistance to educated unemployed youths of India. This scheme empowers individuals to establish business ventures in the manufacturing, trading and service sectors.
Here’s a detailed guide on Pradhan Mantri Rozgar Yojana to make it easier for eligible candidates to avail the benefits of this scheme.
Main features of Pradhan Mantri Rozgar Yojana
- This scheme provides up to Rs.2 lakh for the business sector. On the other hand, it provides up to Rs.5 lakh for the industrial and service sectors.
- It offers a moratorium period. Here, individuals can earn from their venture before they start repaying. After its completion, the repayment tenor extends up to 3 to 7 years.
- This PMRY scheme offers up to Rs.1 lakh loan amount without demanding any collateral.
- The financial coverage applies to all business sectors, barring direct agricultural operations like raising crops, etc.
- The Pradhan Mantri Rozgar Yojana offers a 15% subsidy on the total project cost. The maximum limit is Rs.12,500 per individual. However, the maximum subsidy is limited to Rs.15,000 for candidates from the North-eastern region, Himachal Pradesh, Uttaranchal, Jammu & Kashmir.
- Beneficiaries are eligible for 15-20 days of training. This allows budding entrepreneurs to establish a successful business.
- A financial institution may ask an applicant for margin money, ranging from 5% to 16.25% in terms of the cost of the project. However, the total subsidy and the margin money should not be more than 20% of the cost of the project.
- Headed by the Ministry of Small Scale, Rural, Agro Industries, the Development Commissioner (Small Scale Industries) is responsible for handling this scheme.
- The state-level PMRY committee is responsible to assess the PMRY scheme’s progress.
Eligibility criteria to avail Pradhan Mantri Rozgar Yojana
Once you are aware of the features of Pradhan Mantri Rozgar Yojana, take a look at a few of its eligibility parameters:
- You need to be an unemployed Indian citizen between 18 to 35 years of age. There is a relaxation in the age bar for SC/STs, women, up to 10 years. Likewise, it is 45 years for the residents of the seven North-eastern states.
- Minimum educational qualification requires one to be an 8th standard passed individual.
- The minimum family annual income must be Rs.40,000 and should not exceed Rs.1 lakh.
- An individual must not be a defaulter in payment to any nationalised financial institution.
- Must be a permanent resident of an area for up to 3 years.
- An applicant who benefitted from any subsidy-linked Government scheme is not eligible to apply for this one.
If an individual fails to meet the eligibility parameters mentioned above, alternatively, he/she can opt for a loan against property.
This secured form of credit comes with no end-use restriction. Thus, you can use the loan against property to start your business. Moreover, reputed financial institutions offer high-value loan amounts at a competitive interest rate.
They also extend pre-approved offers to streamline the loan application process further with minimum documentation. You can check your pre-approved offer by entering your name and contact number.
Documents one needs for the PMRY scheme
Here are a few important documents that individuals need to keep ready for a hassle-free borrowing experience:
- Identity proof (Aadhaar card, PAN card, etc.)
- Birth Proof document (SSC/HSC mark sheet)
- Residential proof (Ration card)
- Income certificate issued by Mandal Revenue Officer (MRO)
- Caste Certificate issued by MRO
- Driving licence
- A copy of the proposed project document
- EDP or Entrepreneurship Development Programme Certificate
- Necessary technical or educational certificates
- Duly signed application form
- Passport-size photographs
Also, individuals must make sure to contact the lender beforehand for any additional necessary documents.
Steps to apply for Pradhan Mantri Rozgar Yojana
Given below is a step-wise guide to applying for this PMRY scheme:
1: Visit the official website of Prime Minister Rozgar Yojana.
2: Fill in the relevant details on the downloaded application form.
3: Submit the form to the eligible financial institution that comes under the PMRY scheme.
After verification, a representative will contact you for further proceedings.
Thus, keeping all these aspects in mind, one can avail of the benefits of Pradhan Mantri Rozgar Yojana without any hassle. Additionally, if one borrows a loan against property for business, he/she must also know how to avail tax benefits on LAP to save on tax payable.
Additional Read: What Is the Importance of a Real Estate Property Manager?