Unemployment is one of the biggest hurdles in a country’s overall progress. If a majority of the workforce ends up unemployed, it takes a massive toll on the nation’s economy and also its global position when it comes to finances. For India, this seems to be all the more of a problem because the population is quite high and the job opportunities are few.

Keeping the problems arising due to unemployment at its core, the state government and the central government have decided to implement new schemes for the welfare of the people. One such scheme is Pradhan Mantri Rozgar Yojana. The PM Rojgaar Yojana is an employment scheme that aims to offer employment to those who find it difficult to sustain themselves. The need for PM Rojgaar Yojana or the PMRY is all the more now, in a world that is crippled with the after effects of a pandemic that has practically got world economics to its knees.

About the scheme

The Pradhan Mantri Rozgar Yojana or the PMRY was announced in 2019 aims at the welfare of those who find themselves to be without jobs. The ideal aim of the scheme is that if you cannot find your own job, you can venture into Self-employment. The scheme provides aid and assistance to those looking for self-employment.

Those from rural areas often have business ideas but multinational banks reject loan sanctions. And even if, by some stroke of luck, the loan goes through, the interest rates will be exorbitantly high.

To help people out with their businesses, the government of India started the PM Rojgaar yojana which gives better employment opportunities to all. It basically offers business loans at really cheap interest rates, enabling small business to take flight without too many strings attached.

Main Objective

The PMRY provides employment opportunities to educated youngsters who are unemployed. The scheme is a central government initiative and works towards the welfare of those who are not able to find a job in this highly competitive world.

It also provides financial assistance to those who are willing to start their own business in sectors like service, trade, or even manufacturing.

Features of the PMRY

  • The repayment tenure for the loan availed by the unemployed extends between 3-7 years after the moratorium period is complete
  • The scheme offers a project cost coverage of ₹2 lakhs, ₹5 lakhs and ₹5 lakhs for business sector, service sector and industry sector respectively
  • A collateral-free loan is offered of up to ₹1 lakh under the PMRY scheme
  • The scheme covers all economically viable options, especially business options which include agricultural and allied activities. The PMRY however does not include agricultural operations
  • The scheme provides a subsidy of 15% of the project cost with a maximum of ₹12,500 for every individual.

The eligibility criteria to qualify for the PMRY

In order to avail the benefits of the PMRY, the applicant must adhere to the following criteria:

  1. The applicant should at least be 18 years of age and maximum 35 years. In case of women, ex-servicemen, disabled personnel, SC/ST the maximum age is 45 years for application.
  2. The monthly income of the family of the person applying should not be more than ₹40,000
  3. The applicant should, at least, be educated up to the 8th grade and should have a letter of verify the same.
  4. The applicant can apply from anywhere as long as the applicant has lived there for at least 3 years.
  5. The applicant can only get the business loan from PMRY only if the applicant has not applied for a loan from any other government bank.

What is the interest rate offered by the PMRY?

One of the salient features of the scheme is the fact that it offers cheap interest rates on business loans. The question, therefore, becomes, what is the interest rate? According to the instructions given out by the Reserve Bank of India, the interest rate is subject to change from time to time, depending on the market condition.

However, if you take a loan under this scheme, you would have to pay 12 per cent interest on a loan of 25,000 and on the amount ranging from 25,000 to 1 lakh, the interest rate would be 15.5 per cent.

If the loan amount exceeds 1 lakh, the interest rate gets higher too.

In conclusion

Unemployment is an evil that clutches the individual’s life and also the national economy. It pushes the person into the depths of debt, forever strangling the poor in a vicious cycle of poverty. Offering employment to people especially in a saturated market gets increasingly problematic. So instead, the PMRY encourages people to build on start ups, as that encourages more employment opportunities. Through this scheme, unemployed candidates finally see a glimmer of hope.


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