The application process under the scheme is significantly simplified and can be completed both offline and online. Either way, the individual will be called for an interview. After that, he or she has to undergo seven days of EDP training. Then, only after submitting the certification of the training the loan amount will be disbursed to the individual.
The UYEGP (Unemployment Youth Entrepreneurship and Guidance Programme) is a scheme introduced by the Tamil Nadu government to promote entrepreneurship among the state's youth. The scheme provides financial assistance to young individuals who want to start a business. By offering support in the form of loans, the government hopes to create job opportunities in Tamil Nadu.
Did You Know? UYEGP scheme is a significant initiative by the Tamil Nadu Government to promote youth entrepreneurship.
Overview of Tamil Nadu's UYEGP Scheme
The scheme incentivises the young population to start businesses and become self-employed. The scheme will also contribute to the state's economic growth.
The scheme also offers a subsidy to applicants for the lock-in period of 3 years which in turn reduces the loan amount and interest for the project.
The Aim of the UYEGP Scheme
The scheme aims to provide capital assistance to the state's youth through loans from financial institutions.
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Here are a few of the features of the scheme:
1. Project Cost
A significant portion of the project cost can be reimbursed from the scheme. The reimbursement amount will extend to 90% of the project cost for individuals falling under the general category. Furthermore, for individuals under the special category, the same can be extended to 95%.
2. Interest Rates
As of now, interest rates are determined by RBI guidelines.
3. Tenure of Loan Payment
The loan repayment period is fixed at five years.
The scheme promotes the spirit of entrepreneurship among the youth and provides the young population with abundant employment opportunities.
5. Maximum Cost of the Project
Under the scheme, the maximum cost of the project can be ₹ 10.00 lakh in the case of manufacturing, ₹ 3.00 lakh in the case of Service and ₹ 1.00 lakh in the case of the business project.
The projects will additionally be provided with a subsidy of 25% of the project cost, capped at ₹ 1.25 lakh. However, to avail of the subsidy benefit, the project must be locked for three years; thus, the applicant cannot curtail or close down the project before the lock-in period is over. Otherwise, the subsidy amount will have to be returned.
7. Capital Expenditure
For this scheme, the project cost includes capital expenditure to acquire the assets and the first cycle of working capital.
8. Selection of Applicants
The applicants are selected through an interview conducted by the District Task Force Committee headed by the District Industries Centre. This was done to easily disburse the loan and the subsidy to the applicant on time.
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Eligibility for the Scheme
An applicant must be at least 18 years old. For a general category individual, the maximum age limit is 35 years. In the case of a special category individual, it is extended to 45 years of age.
The family income of the applicant should be at most INR 1.50 lakh.
To be eligible for the scheme, the individual must have passed the 8th standard from a recognised board of studies.
The applicant must have been a Tamil Nadu resident for the last three years.
5. Causes for Ineligibility
- The applicant must be an individual. Partnerships and corporate entities are not eligible for the scheme.
- The individual must be a first-time applicant. Any individual who has benefited from the scheme will be ineligible to reapply for the scheme.
The eligible applicant will be required to go through EDP training.
No collateral is required for projects up to INR 10.00 lakh.
8. Special Category
The special category for individuals includes
- Scheduled Tribe
- Schedule Caste
- Physically Challenged
- Most Backward Class
- Backward Class
The beneficiary under the scheme will be provided with the loan amount net of the subsidy. The banks will have to make claims for the subsidy from the government.
Benefits of the UYEGP Scheme
The UYEGP scheme offers several benefits to eligible individuals looking to start businesses in Tamil Nadu. Some of the key benefits of the scheme are as follows:
- The scheme provides financial assistance through loans at subsidised interest rates to help cover the cost of starting a business.
- The scheme offers technical assistance in 7 days of EDP training to help eligible individuals develop their business skills and better understand the industry.
- The primary aim of the scheme is to reduce unemployability among the socially and economically backward population and uplift them to become self-employed.
- By encouraging entrepreneurship and job creation, the UYEGP scheme helps to grow the economy of Tamil Nadu.
- The beneficiaries under the scheme are selected at the district level, ensuring more inclusion in the scheme.
- Multiple financial institutions, including scheduled banks and Tamil Nadu Industrial Corporation Bank, can reimburse the loans.
- Easy repayment plans for the loans.
- No collateral will be required up to the project cost of ₹ 10.00 lakh. In addition, banks will be protected by the Credit Guarantee Trust to ensure compliance with banking laws.
- The scheme provides access to new markets with the assistance of District Industries Center (DIC) marketing support and helps eligible individuals connect with potential customers and suppliers.
How to Make an Application for the Scheme?
To take advantage of the scheme's benefits, eligible applicants can apply both online and offline. Here are the steps to get started:
- Visit the official website of the MSME development of the Tamil Nadu government. For easy reference, click here.
- Choose the option of UYEGP from the homepage.
- On the next page, hover over "apply online" and click "New Application."
- Please fill in the details requested. You must provide information about the project, including the amount, address and gestational period.
- Click on the procedure, and you will be given an application ID.
- After you fill in all the details, you must upload a scanned copy of a few documents using the application ID.
- Now, wait for the application to be verified and approved. Await the bank confirmation for the grant of the loan.
- Visit the official website of the MSME development of the Tamil Nadu government and download the form for making an application for the scheme.
- Next, fill in the details of the application form.
- Gather all the documents mentioned in the form.
- Submit the form and all the other documents to the District Industries Centre.
Once the interview is done, the bank will approve the loan amount for the applicant. After that, you will have to go through seven days of EDP training once you get the training certificate. Submit it to the bank, which will disburse the loan.
Documents Required Under the UYEGP Scheme
- A passport-sized photo is attached to the application form.
- Educational qualification of the applicant
- Ration cards.
- Record sheet of the applicant as issued by the school.
- If the applicant does not own a ration card, a copy of an Aadhar card or electoral voter card will be sufficient.
- Project report.
- Disability certificate, if applicable.
- Residential proof.
- Quotation of the asset under the project, including the GST number.
- Any other document as may be required by the bank.
The UYEGP (Unemployment Youth Entrepreneurship and Guidance Programme) scheme introduced by the government of Tamil Nadu is a remarkable initiative aimed at promoting entrepreneurship among the state's youth.
The scheme offers various benefits, including financial and technical assistance and training programs. By supporting young individuals who have a passion for starting a business, the scheme is helping to create job opportunities and boost the economy of Tamil Nadu. By providing access to funding and resources, the UYEGP scheme helps individuals socially and economically turn their business ideas into reality and achieve their entrepreneurial goals.
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