PMFME

Prime Minister Formalization of Micro Food Processing Enterprises (PMFME)

The Prime Minister Formalization of Micro Food Processing Enterprises (PMFME) scheme is a transformative initiative by the Government of India to uplift micro food entrepreneurs and catalyze the growth of the food processing sector. Launched with the vision of fostering a robust and competitive environment, PMFME offers a range of benefits to eligible enterprises.

Key Features:

1. Financial Assistance:

Unlock the potential of your micro food processing business with access to collateral-free loans, subsidies, and financial support tailored to your specific needs.

Loan Amounts: Collateral-free loans for micro food enterprises, providing financial assistance to meet working capital and investment requirements.
- Up to Rs. 10 lakhs for working capital needs.
- Up to Rs. 50 lakhs for the establishment, modernization, or expansion of micro food processing units.
Subsidies: Substantial subsidies for eligible activities, reducing the financial burden on entrepreneurs.
- Up to 35% subsidy on the total project cost for general categories.
- Up to 50% subsidy for SC/ST entrepreneurs, women, and entrepreneurs from the North-Eastern region.
Margin: Minimum of 10% of the project cost.

Quantum of Loan:
- Minimum loan: No ceiling
- Maximum loan: No ceiling
Repayment: Max. 10 years, including a maximum moratorium of 6-24 months.
Security: As per Bank’s extant guidelines.

Interest rate:
- For Eligible MSME Entities:
  - Loan up to Rs. 2 Cr: EBLR (External Benchmark based Lending Rate) +200 bps.
  - Loan above Rs. 2 Cr: As per Bank’s extant guidelines.
- For Other Categories (FPOs/ SHGs/ Producer Cooperatives):
  - Loan up to Rs. 50 lakhs: EBLR +360 bps
  - Loan above Rs. 50 lakhs: As per Bank’s extant guidelines.
Upfront fee: As per Bank’s extant guidelines, subject to revision by the bank from time to time.

2. Formalization Support:

Embrace formal business operations with assistance in meeting quality standards, obtaining certifications, and enhancing overall competitiveness.

Quality Standards: Support for adopting quality management standards, including certifications that boost the credibility of your products.
Technical Assistance: Expert guidance on formalizing operations, ensuring compliance with regulatory requirements.

3. Skill Development:

PMFME emphasizes skill development programs to empower entrepreneurs with the knowledge and expertise needed for sustained growth in the food processing industry.

Training Programs: Access to skill development and training initiatives to enhance the capabilities of your workforce.
Capacity Building: Workshops and seminars focused on building technical and managerial skills in the food processing domain.

4. Incentives for Startups:

If you're launching a new venture, PMFME offers a range of incentives and benefits to kickstart your entrepreneurial journey in the food sector.

Startup Incentives: Special incentives and support for startups, encouraging innovation and new entrants in the food processing industry.
Incubation Support: Access to incubation facilities and mentorship programs to guide startups through the initial stages of business development.

Eligible Entities:

Individual entrepreneurs/ Proprietorship Firms/ Partnership Firms/ Farmer Producer Organizations (FPOs)/ NGOs/ Cooperatives/ SHGs/ Pvt. Ltd. Companies, who have established or propose to establish micro food processing units.

Documents Required:

Application Form
Two Passport Size Photographs.
ID proof such as Driving License/ Aadhar Card/ Voter Identity Card/ Passport.
Address Proof such as voter ID card, Driving License, Aadhar Card.
Detailed Project Report (DPR)
Any other document as per sanction.

ODOP Brands and State Brands:

List of ODOP brands and State brands launched under PMFME.

Marketing and Branding Support:

50% grant for Groups to develop a common brand, standardization, and packaging.
Benefits include product standardization, trademark registration, market study, etc.

Individual Beneficiaries:

Opportunity to come under created brands if in a similar product line.
Support for branding, market linkages, processing, product development, and logistics.

Agriculture Infrastructure Fund (AIF) and Animal Husbandry Infrastructure Development Fund (AHIDF)

AIF:

Interest subvention of 3% per annum up to Rs. 2 Crore.
Credit guarantee coverage for eligible borrowers.

AHIDF:

Interest subvention of 3% per annum.
DAHD pays interest subvention directly to the scheduled bank.

Interest Subvention/Top-Up Assistance

1. Interest Subvention for SC/ST:

SC/ST beneficiaries eligible for refinancing support from NSFDC & NSTFDC.
Beneficiaries advised to choose partner banks of NSFDC/NSTFDC.

2. Interest Subvention through AIF and AHIDF:

AIF and AHIDF schemes provide 3% interest subvention.
Beneficiaries can apply through respective portals.

3. Top-Up Grant in Convergence with Other Schemes:

Applicants eligible for bank loan even if availed loan in other government schemes.
Top-up grant can be availed without duplicating benefits.

Loan Processing and Disbursement Process

VIII. Scrutiny by Processing Centre:

Processing Centre scrutinizes documents & completes loan appraisal formalities.
Loan is sanctioned by the appropriate authority, and the Branch conveys the sanction.

IX. Sanction Letter Issued:

Branch issues sanction letter to the applicant.
Branch uploads sanction letter on PMFME Portal.

X. Second Preferred Bank:

If the first preferred bank rejects, the application moves to the second preferred bank.
Second bank completes all formalities detailed for the first bank.

XI. Disbursement:

Disbursement starts as per sanction terms.
Upon disbursement, details are uploaded on PMFME portal.
MoFPI requests State to release its share and releases Centre's share to Nodal Bank.

Key Points:

No collateral security required for PMFME loans up to Rs. 2.00 Crores.
Mortgage of land/plot required for technical construction.
Updated DPR/documents can be uploaded to avoid rejection.
Service Area not applicable in PMFME scheme.