The economic downturn witnessed in 2020 brought a few unpleasant situations, and a sharp rise in the unemployment rate was one of them. According to data, India’s unemployment rate stood at 9.1% in December 2020.
From increasing job vacancies to launching several schemes, the Central Government has taken multiple initiatives from time to time to curb this major issue in India. Prime Minister Rozgar Yojana is one of such initiatives, launched back in 1993 to assist the country’s unemployed youth with sustainable self-employment options. Thus, individuals who are about to start their career and looking for monetary support to set up their own venture need to know the scheme’s features and benefits.
What is PMRY?
Launched to extend self-employment opportunities, this scheme provides necessary financial assistance to individuals starting their businesses in the Manufacturing, Industry and Service sectors. It often gets difficult to get business loans sanctioned, especially in the initial phase. In such cases, schemes like PMRY comes as a great aid with their salient features, subsidy options, etc.
Advantages of availing PMRY
Here are the key features and benefits of Prime Minister Rozgar Yojana:
- Rate of interest: Generally, interest rates vary from one lender to another, depending on the loan amount you are availing, as per Government guidelines.
- Tenor: Once the moratorium period gets over, the repayment tenor for the loan under this scheme extends from 3 to 7 years.
- Collateral: As per the scheme’s norms, no collateral is necessary if you obtain up to Rs.1 lakh for Business and Service sectors and Rs.2 lakh for projects under the Industry sectors. Additionally, an exemption of up to Rs.1 lakh will be provided to individuals participating in partnership projects.
- Subsidy: 15% of the total project cost will be provided as a subsidy of up to Rs.12,500 per individual. Note that the total subsidy amount cannot exceed 20% of the total project cost.
- Training: Individuals who are a part of the Industry sectors need to go through a training period of nearly 15 to 20 days. For beneficiaries belonging to Business and Service sectors, the training period lasts for 10 days, and it will cost per individual around Rs.2000.
Thus, PMRY is an ideal solution for young entrepreneurs looking for substantial funds to invest in their projects. However, they also need to meet the basic eligibility parameters to enjoy these perks.
Eligibility criteria for Prime Minister Rozgar Yojana
Following are the parameters one needs to meet to qualify for the scheme:
- The applicant should be a permanent resident of India and between 18 and 35 years of age.
- In terms of educational qualification, individuals should be a minimum 8th standard passed.
- The family income (including that of the spouse) cannot cross Rs.1 lakh.
- The applicant should have a clean repayment track record, has not been a loan defaulter in the past and never applied for any subsidy-linked scheme either.
Individuals meeting these eligibility parameters can obtain a sizeable amount under Prime Minister Rozgar Yojana. However, there are other secured loan variants as well that offer a considerable amount at affordable interest rates. For instance, credit facilities like a loan against property allow borrowers to acquire substantial funds by pledging their immovable assets as collateral.
The eligibility requirements are more relaxed in that case due to its secured nature, and you also get to choose a flexible repayment tenor to manage your EMIs better. Also, housing finance companies provide certain pre-approved offers on these loans, which enable borrowers to expedite and simplify loan processing. Check your pre-approved offer online by entering your name and contact number.
Note that there is a special preference given to the weaker sections of the society, including women applicants under Prime Minister Rozgar Yojana. The scheme holds 22.5% reservation for SC/ST and 27% for OBC applicants. Therefore, individuals belonging to all social strata can leverage this scheme and grow their business without a hassle.