The Prime Minister Rozgar Yojana, or PMRY, is a self-employment scheme launched in October 1993. Aimed towards providing means of employment to the educated yet unemployed section of India, Prime Minister Rozgar Yojana has proven to be a sustainable and effective plan to reduce unemployment across the country.
The scheme covered both the rural and urban settings across the nation, extending its reach to the remote sections of the country as early as the years 1994–1995. The primary objective of this scheme is to create sources of sustainable employment by establishing micro-enterprises across the nation, mainly in the manufacturing, service and business sectors.
- PMRY continued in its 9th Five Year Plan with a planned target of creating 11 lakh beneficiaries. The same target will be applicable for its next (10th) Five Year Plan as well.
The unique architecture of the Pradhan Mantri Rozgar Yojana distributes the responsibility and funds to grassroots levels, i.e. to District Industry Centres and financial organisations. It is also overseen by the Directorate of Industries, ensuring proper utilisation of funds for the betterment of the country.
Objectives of the Prime Minister Rozgar Yojana
The primary objectives of this scheme include the following –
- Selecting businesses and entrepreneurs and motivating them by training, financial assistance, and other means.
- Identifying and motivating businesses which primarily deal with the service industry, trade, and in SME as well as the MSME sectors.
- Determining or acknowledging vocational activities for entrepreneurs and businesses across India.
- Setting up financial assistance for businesses, including organisations that require funding in the form of long-term, secured financing like a loan against property.
PMRY scheme facilitates quick sanction and disbursal of loans because of the well-structured implementation of the scheme. Each district acts as a well-defined geographical unit, allowing prospective applicants an easy way to reach for the assistance.
Applicants can directly apply to their respective District Industries Centre or Directorate of Industries. Primary screening of all applications is done by either a district or block level task force created under the scheme body.
Members of the task force also include representatives from leading financial institutions, which help benefit-seekers avail financial assistance under PMRY. One can easily learn how to utilise a loan against property and such other funds to boost their organisation’s reach.
Prime Minister Rozgar Yojana also allows the involvement of reputed non-governmental organisations to identify, select, and motivate the beneficiaries. Private sector bodies can also assist beneficiaries in managing their assets, and teaching them essential financial skills like how to make timely repayment of loan instalments. A strong understanding of factors like how debt consolidation can help manage finances better can assist entrepreneurs and businesses to reach their goals with ease.
Features of the Prime Minister Rozgar Yojana
The prominent features of PMRY can be seen in training, rate of interest provided against the disbursed loan amount, collateral, and moratorium period offered for each beneficiary. Let’s take a look.
- Training –
Businesses and entrepreneurs shortlisted for this scheme will be offered training and teaching assistance by the Government of India. It is compulsory for all industrial and service ventures.
Training programs under Prime Minister Rozgar Yojana are concluded before the disbursal of the loan. Financial institutions can approve and disburse the credit only if a particular applicant attends and completes his/her training. Training programs usually run for one month. However, depending on the requirements, they can extend beyond that period.
This scheme also caters to specific socio-economic requirements of applicants during the training period, similar to other projects like the Skill India initiative. For example, it includes the latest discoveries in respective fields, along with new and emerging trends. The training programs also put special attention to women empowerment by providing them training for the service and manufacturing industry.
- Rate of interest –
The applicable rate of interest on the loan granted under this scheme would be decided as per instructions issued by the RBI. Other than that, if an entrepreneur wants to avail finances from independent sources, he/she will repay as per the interest rate offered by that particular organisation. One must, however, also know the other charges of his/her LAP or any other loan before applying.
For example, some financial institutions offer secured credits at affordable interest rates. Also, advances like loans against property are processed in minimum time with these lenders, allowing borrowers to avail them quickly.
Moreover, they also provide pre-approved offers to existing customers, simplifying the application process significantly. These offers are available in several financial products, including loans against property and home loans. You can check your pre-approved offer online by sharing only some essential details like your name, contact information, etc.
- Subsidy –
Beneficiaries can earn subsidies of 15% of the project cost, subject to a ceiling of Rs.7,500 under the PMRY scheme. This amount will be kept as a fixed deposit for the duration of the loan. However, no interest will be provided on this FD.
- Moratorium period –
PMRY offers an initial moratorium period of 6 to 18 months for each applicant. However, this period can be reduced if the surplus income justifies the commencement of repayment. For this, the monitoring bodies will review the working capital limit periodically.
Prime Minister Rozgar Yojana is a well-proven employment scheme, catering to hundreds of aspiring entrepreneurs and businesses across the nation. Its unique structure allows better provision of resources, while a well thought out system provides maximum benefits to each applicant.
