Uttar Pradesh Pt. Deendayal Gramodyog Rozgar Yojana

Scheme Introduction: A Brief Overview

The Pandit Deendayal Gramodyog Rozgar Yojana is an interest subsidy scheme launched by the Government of Uttar Pradesh. It provides financial assistance to eligible rural enterprises that have been established and financed under the Prime Minister's Employment Generation Programme (PMEGP).

Only those rural entrepreneurs are eligible for this scheme whose PMEGP loan has already been approved and disbursed. The benefit is available only for projects approved during the current financial year.

The main objective of the scheme is to:

• Reduce unemployment in rural areas.
• Discourage educated unemployed youth from migrating to cities.
• Create more employment opportunities within villages.
• Strengthen industries established under the One District One Product (ODOP) programme by helping them adopt modern technology and improve their financial condition.

The Government believes that many PMEGP units face financial difficulties because of their high project costs. This increases their loan burden and may result in weak business performance or closure of the enterprise.

To address this issue, the scheme provides an interest subsidy of up to 13% on the remaining loan amount after deducting the margin money subsidy and the entrepreneur's contribution. This subsidy is available for a maximum of three years from the date of the first loan disbursement.

The scheme is applicable in all rural areas of Uttar Pradesh. It covers eligible PMEGP rural units sponsored by:

• District Industries Centre (DIC)
• Khadi and Village Industries Commission (KVIC)
• Uttar Pradesh Khadi and Village Industries Board (UPKVIB)

However, any person who is already receiving an interest subsidy under any other self-employment scheme of the Central or State Government is not eligible for this scheme.

The Government of Uttar Pradesh runs several schemes to promote entrepreneurship and self-employment. Schemes such as the Chief Minister Yuva Udyami Vikas Abhiyan (CM-YUVA) and the Chief Minister Gramodyog Rozgar Yojana provide financial assistance for setting up new enterprises. In comparison, the Pandit Deendayal Gramodyog Rozgar Yojana helps eligible PMEGP rural units by reducing their loan interest burden, making their businesses financially stronger. 

Scheme Benefits

• Eligible rural entrepreneurs receive an interest subsidy of up to 13% on loans obtained under the Prime Minister's Employment Generation Programme (PMEGP) for a maximum period of three years.
• The scheme reduces the financial burden of loan interest, making it easier for entrepreneurs to run their businesses smoothly.
• It helps strengthen PMEGP units established in rural areas by improving their financial stability.
• The scheme reduces the chances of business closure and encourages the continuous operation of rural enterprises.
• It promotes self-employment and creates more job opportunities in rural areas.
• Industries established under the One District One Product (ODOP) programme also receive financial support through this interest subsidy.
• The interest subsidy is released every six months according to the prescribed procedure.
• The subsidy amount is transferred directly to the beneficiary's loan account through the bank.

Financial Assistance / Interest Subsidy

Under the Pandit Deendayal Gramodyog Rozgar Yojana, eligible rural enterprises receive an interest subsidy on loans sanctioned under the Prime Minister's Employment Generation Programme (PMEGP).

• The subsidy is provided on the remaining loan amount after deducting the margin money subsidy and the entrepreneur's own contribution.
• The scheme provides an interest subsidy of up to 13% on the eligible loan amount.
• The benefit is available for a maximum of three years from the date of the first loan disbursement.
• The interest subsidy is paid once every six months following the prescribed procedure.
• The approved subsidy amount is transferred directly to the financing bank through NEFT/RTGS in favour of the beneficiary.

Eligibility Requirements

To receive benefits under the Pandit Deendayal Gramodyog Rozgar Yojana, the applicant must meet the following conditions:

• The enterprise must be established and financed under the Prime Minister's Employment Generation Programme (PMEGP).
• The PMEGP loan must have been approved and disbursed. The enterprise becomes eligible for the interest subsidy only after the loan has been released.
• Only eligible rural enterprises can receive benefits under this scheme.
• Rural units sponsored by any of the following agencies under PMEGP are eligible:
• District Industries Centre (DIC)
• Khadi and Village Industries Commission (KVIC)
• Uttar Pradesh Khadi and Village Industries Board (UPKVIB)
• Applicants who are already receiving an interest subsidy under any other self-employment scheme of the Central or State Government are not eligible for this scheme.

Required Documents

To claim the interest subsidy through the financing bank, the following documents must be submitted:

• Forwarding letter issued by the sponsoring agency (DIC/KVIC/UPKVIB).
• Loan Sanction Letter issued by the financing bank.
• Updated bank statement of the loan account.
• Documents related to the Term Deposit Receipt (TDR).
• Interest Subsidy Claim Form in the prescribed format.
• Inspection report issued by the Branch Manager of the financing bank.
• Photograph of the beneficiary at the enterprise/workplace.
• Important: After all required documents are verified, the District Village Industries Officer ensures that the interest subsidy payment is processed within 15 days. 

Steps to Apply

To receive the interest subsidy under the Pandit Deendayal Gramodyog Rozgar Yojana, the applicant must first establish an eligible enterprise and obtain a loan under the Prime Minister's Employment Generation Programme (PMEGP). After the loan is approved and disbursed, the interest subsidy process is completed through the financing bank and the concerned District Village Industries Officer.

• Step 1: Visit the official website of the Uttar Pradesh Khadi and Village Industries Board (UPKVIB).
• Step 2: On the homepage, go to the "Online Services" section and click on the "Pandit Deendayal Gramodyog Rozgar Yojana" link. You will be redirected to the scheme portal.
• Step 3: Click on "Download Required Forms" and download the following documents:
  • Application Form
  • Detailed Project Report (DPR) Format
  • Workplace Certificate
• Step 4: Fill in the application form carefully, attach all the required documents, include the workplace certificate, and submit the application as per the prescribed procedure.
• Step 5: Once your PMEGP loan has been approved and disbursed, the financing bank will use the following documents to claim the interest subsidy:
  • Forwarding Letter from the sponsoring agency (DIC/KVIC/UPKVIB)
  • Loan Sanction Letter
  • Bank Statement
  • TDR-related documents
  • Inspection Report
  • Other required records
• Step 6: After the margin money subsidy is credited, the financing bank prepares the interest subsidy claim every six months and sends it to the concerned District Village Industries Officer.
• Step 7: The District Village Industries Officer examines the claim, verifies the documents, completes the audit process, and approves the interest subsidy.
• Step 8: Once approved, the interest subsidy amount is transferred to the beneficiary's loan account through the concerned bank via NEFT/RTGS.

Interest Subsidy Payment Process

The interest subsidy is released through the following process:

• Step 1: After the margin money subsidy is credited to the entrepreneur's PMEGP loan account, the bank deducts the margin money subsidy and the entrepreneur's own contribution from the total project cost. The remaining amount is treated as the eligible loan amount.
• Step 2: Based on the interest payable on the eligible loan amount, the bank prepares an interest subsidy claim every six months and submits it to the District Village Industries Officer.
• Step 3: The District Village Industries Officer verifies the claim and supporting documents. After the audit verification is completed, the payment process is initiated.
• Step 4: The approved interest subsidy amount is transferred directly to the beneficiary's loan account through the concerned bank using NEFT/RTGS.
• Step 5: The interest subsidy is paid every six months, and the District Village Industries Officer informs both the beneficiary and the financing bank about the payment within 7 days.

Post-Application Process

• After receiving the application and supporting documents, the District Village Industries Officer examines all the records.
• If required, a physical inspection of the enterprise is also conducted. The interest subsidy claim is then verified through an auditor.
• If all documents and records are found to be correct, the interest subsidy is approved.
• The approved subsidy amount is transferred to the beneficiary's loan account through the concerned bank using NEFT/RTGS.
• After the payment is made, the District Village Industries Officer informs both the beneficiary and the financing bank within 7 days.
• As per the Government Order, the District Village Industries Officer must complete the necessary action on the received claim and ensure payment within 15 days.

Terms and Conditions

To receive the interest subsidy under the Pandit Deendayal Gramodyog Rozgar Yojana, beneficiaries must follow these conditions:

• The benefit is available only to eligible rural enterprises established and financed under the Prime Minister's Employment Generation Programme (PMEGP).
• The entrepreneur must establish and operate the enterprise according to the approved project.
• If the loan amount is misused, the entrepreneur will not be eligible for the interest subsidy.
• If the entrepreneur fails to complete the project or intentionally defaults, the benefit of the scheme will not be provided.
• If the enterprise stops production or services, or is no longer operational, the interest subsidy will not be payable.
• If the entrepreneur dies due to a natural disaster or an unforeseen accident, resulting in the closure or disruption of the enterprise, the case will be considered individually. The final decision will be taken by the Uttar Pradesh Khadi and
• Village Industries Board based on the recommendation of the District Magistrate and the prescribed committee.
• If the entrepreneur closes the enterprise within three years, misuses the loan, or fails to establish and operate the unit according to the approved project, the bank will recover the loan amount as well as the interest subsidy provided under the scheme as per the rules.

When Will the Interest Subsidy Not Be Available?

An enterprise established and financed under PMEGP will not receive the interest subsidy in the following situations:

• If the entrepreneur has misused the loan amount.
• If the entrepreneur has failed to complete the project and has intentionally defaulted.
• If the enterprise has stopped production or services or is no longer operational.

Special Provision

If an entrepreneur dies due to a natural disaster or an unforeseen accident, and the enterprise is affected as a result, the case will first be examined by the District Magistrate.

After that, the District Level Task Force Committee (DLTFC) constituted under PMEGP will review the case and make its recommendation.

Based on the committee's recommendation, the Chief Executive Officer of the Uttar Pradesh Khadi and Village Industries Board will take the final decision according to the applicable rules.

Recovery of Interest Subsidy

If the entrepreneur: closes the enterprise within three years, intentionally misuses the loan amount, or fails to establish and operate the enterprise according to the approved project,

the bank will recover both:

• the outstanding loan amount, and the interest subsidy already provided under the scheme.
• As per the Government Order, the recovery of the loan and the interest subsidy will be carried out from the defaulting entrepreneur through the District Level Task Force Committee (DLTFC) constituted at the district level under the Prime Minister's Employment Generation Programme (PMEGP).

As per the Government Order, the recovery of the loan and the interest subsidy will be carried out from the defaulting entrepreneur through the District Level Task Force Committee (DLTFC) constituted at the district level under the Prime Minister's Employment Generation Programme (PMEGP).

Relevant Links

• Official Website of the Uttar Pradesh Khadi and Village Industries Board
• Pandit Deendayal Gramodyog Rozgar Yojana Portal
• Pandit Deendayal Gramodyog Rozgar Yojana Guidelines
• Pandit Deendayal Gramodyog Rozgar Yojana Application Form

Contact Information

• Uttar Pradesh Khadi and Village Industries Board
• Address: 8, Tilak Marg, Lucknow – 226001
• Phone: 2208321 / 2208310 / 2208313 / 2207004
• Gramodyog Samadhan Cell (Toll-Free): 18001207699