PMEGP MSME Loans Drop 45% in FY25

Chennai: The loans sanctioned for MSMEs under Prime Minister’s Employment Generation Programme is down by 45 per cent and those already released are down by 60 per cent till February in FY25 against the previous year. As a result, employment generated by the scheme has declined by 57 per cent.

Under PMEGP, MSMEs got 70,090 loans sanctioned in FY25 till February against 1,26,376 loans in FY24 – down by 45 per cent. Of these, the government has released 42,526 loans against 1,06,908 loans in the previous year-down by 60 per cent. The margin money released under the scheme too is down by 55 per cent from 68,939 in FY24 to 30,916 in FY25.

Due to the fall in the loans, the employment generated by the scheme has dropped by 57 per cent from 712,944 in FY24 to 305,880 in FY25. The key sectors that have benefited the most under PMEGP in terms of job creation were service and textile, agro-based food processing, rural engineering and bio-tech, mineral, polymer and chemical, forest, hand-made paper and fibre and coir.

Service and textile saw the highest employment generation at 147,488, followed by agro-based food processing industry with 66,568 jobs, and rural engineering and bio-tech industry produced 41,864 jobs.

As per the study by PMEGP’s nodal agency Khadi and Village Industries Commission (KVIC), the employment per unit in PMEGP units has increased from an average 9 persons per unit during 2022 to an average 11 per unit in 2023.