Prime Minister Rozgar Yojana, or PMRY, was first introduced on 2nd October 1993. A Government of India initiative to provide means of employment to the educated sections of the community, PMRY offered a sustainable, yet effective plan that helped curb unemployment by a significant margin across India.
- The scheme aims to extend loans to 10 lakh unemployed youth of the country, with a special focus on women’s employment.
Since its introduction, this scheme has gone through several modifications to better meet the changing requirements of a modern society. Today, PMRY scheme covers both the rural and urban areas of India, thanks to its widespread adoption as early as 1994 – 1995. PMRY aims to create employment opportunities via micro-enterprises set-up across the nation, which would primarily deal in business, manufacturing, and service sectors.
By distributing the responsibilities of training and capital management to grassroots-level government bodies, i.e. District Industry Centres, PMRY has been able to attain widespread exposure even in the remotest locations of the country. Fund allocation, utilisation, and other essential aspects are overseen by the Directorate of Industries, ensuring proper engagement of the needy yet eligible individuals.
Facts to consider the Prime Minister Rozgar Yojana
The prominent features of this employment scheme can be seen in its disbursed funds, the interest charge on loans, collateral requirements, moratorium period, and training offered to its beneficiaries. Here is a brief look into the details of this particular prime minister rozgar yojana.
A) Rate of interest –
The rate of interest applicable to advances extended through the Prime Minister Rozgar Yojana is decided according to the instructions issued by the Reserve Bank of India. However, borrowers can enjoy competitive rates if they avail of funding from financial institutions as well.
Most lenders offer some form of added features and benefits with their financial products as well. Like, select financial institutions provide pre-approved offers to existing customers, which streamlines the application process and helps reduce the time taken. Such offers are available on several different types of advances, including secured credits like loans against property, home loans, etc. You can check your pre-approved offer online by sharing only some essential details.
B) Subsidy –
A maximum subsidy of 15% of the total project cost, or Rs.12,500 (whichever is higher) is provided under the PMRY scheme. The amount earned as subsidy will be kept as a fixed deposit for the duration of the loan. This particular fixed deposit will, however, not generate any interest for the duration and will serve only as security. Nevertheless, such subsidised funding helps businesses to effectively repay their existing loan.
C) Moratorium period –
Depending on the applicant’s eligibility, he/she is offered moratorium periods of 6 to 18 months. Monitoring bodies review working capital limits periodically, and if required, can reduce the moratorium period if an organisation’s surplus income justifies the commencement of repayment.
D) Training –
The Government of India provides applicants under all three sectors with training and assistance programs under Prime Minister Rozgar Yojana. Attending the training schedule is a mandate for all service as well as business and manufacturing ventures, and is conducted and concluded before disbursal of such loan. Financial assistance is offered only to those who attend and complete this training, which usually runs for 30 days (unless otherwise specified).
E) Funds disbursed
PMRY allocates different funding slabs for every applicant, according to the sector in which he or she wants to invest. For example, individuals willing to venture into the business sector can avail a maximum of Rs.2 lakh as financial assistance. In contrast, for service sector and industry sector investment, candidates are eligible to receive a maximum of Rs.5 lakh as credit.
These advances are offered through some of the leading financial institutions, which also assist borrowers with guidance on credit utilization. Individuals can also offer other forms of advances, for example, a property loan, and learn how to utilize a loan against property and boost their organization’s growth effectively.
Objective of PMRY
The primary objective of PMRY is to select capable entrepreneurs and organisations and motivate them to grow and expand by providing training and financial assistance. It is also a key instrument in identifying businesses that primarily deal in service, trade and manufacturing industry, and can be categorised as SMEs or MSMEs.
PMRY scheme facilitates faster sanction and disbursal of loans as it follows a well-defined structure curated to allow prospective applicants to reach out for assistance. One can thus apply under this scheme through his/her District Industries Centre, where either a block-level or a district-level task force screens all applications to identify the credible ones.
This task force primarily consists of Government officials, representatives from local administrations, and leading financial institutions. By involving private entities for identification, selection, and training, PMRY has been able to reduce the cost associated with the program by a significant margin. Also, it has helped tremendously while teaching how to manage financial assets, how debt consolidation can help manage finances better or similar monetary insights.
How can you apply for the PMRY Scheme?
To apply for the scheme, one should be ready with the project plan in its entirety. This planning can be done independently, or you can also approach development agencies such as your District Industries Centre (DIC) or a Small Industries Service Institute (SISI) to help draft viable projects. After this step, here are the steps you can take to apply for PMRY.
- Prepare the project report alongside the project profile and fill the form.
- Attach necessary documentation, photographs and submit it to the DIC or local bank.
- Prepare for the Task Force Committee interview to be held at a DIC centre near your residence.
- Upon successfully passing the said interview, collect the intimation letter and proceed with bank clearance procedures.
It has thus allowed entrepreneurs and businesses to obtain their goals with relative ease. For these reasons and more, Prime Minister Rozgar Yojana has proved to be a suitable employment scheme, catering to thousands of aspiring businesses across the nation.
