PM Formalisation of micro food processing Enterprises Scheme (PM FME Scheme)

PM FME scheme is a centrally sponsored scheme that is designed to address the challenges faced by the micro enterprises and to tap the potential of groups and cooperatives in supporting the upgradation and formalization of these enterprises. The expenditure under the scheme would to be shared in 60:40 ratios between Central and State Governments.

Aims

The scheme aims to:

• Enhance the competitiveness of existing individual micro-enterprises in the unorganized segment of the food processing industry and promote formalization of the sector; and
• Support Farmer Producer Organizations (FPOs), Self Help Groups (SHGs) and Producers Cooperatives along their entire value chain.

Financial Assistance

The objectives of scheme are to build capability of microenterprises to enable:

• Increased access to credit by existing micro food processing entrepreneurs, FPOs, Self Help Groups and Co-operatives;
• Integration with organized supply chain by strengthening branding & marketing;
• Support for transition of existing 2,00,000 enterprises into formal framework;
• Increased access to common services like common processing facility, laboratories, storage, packaging, marketing and incubation services;
• Strengthening of institutions, research and training in the food processing sector; and
• Increased access for the enterprises, to professional and technical support.

Coverage:  

 Under the scheme, 2, 00,000 micro food processing units will be directly assisted with credit linked subsidy. Adequate supportive common infrastructure and   institutional architecture will be supported to accelerate growth of the sector.

One District One Product:

The Scheme adopts One District One Product (ODOP) approach to reap the benefit of scale in terms of procurement of inputs, availing common services and marketing of products. ODOP for the scheme will provide the framework for value chain development and alignment of support infrastructure.

There may be more than one cluster of ODOP products in a district. A state may have a cluster of ODOP product consisting of more than one district. With respect to support to existing individual micro units for capital investment, preference would be given to those producing ODOP products. However, existing units producing other products would also be supported. In case of capital investment by groups, predominately those involved in ODOP products would be supported. New units, whether for individuals or groups would only be supported for ODOP products.

Support for common infrastructure and marketing & branding would only be for ODOP products. In case of support for marketing & branding at State or regional level, same products of districts not having that product as ODOP could also be included.

Programme Components:

The programme has four broad components addressing the needs of the sector:

• Support to individual and groups of micro enterprises;
• Branding and Marketing support;
• Support for strengthening of institutions;
• Setting up robust project management framework.

 Support to Individual Micro Enterprises:

Individual micro food processing units would be provided credit-linked capital subsidy @35% of the eligible project cost with a maximum ceiling of Rs.10.0 lakh per unit. Beneficiary contribution should be minimum of 10% of the project cost with balance being loan from Bank.

Eligibility criteria for individual micro enterprises under the scheme:

• Existing micro food processing units in operations
• Existing units should be those identified in the SLUP for ODOP products or by the Resource Person on physical verification. In case of units using electrical power, electricity bill would support it being in operations. For others units, existing operations, inventory, machines and sales would form the basis
• The enterprise should be unincorporated and should employ less than 10 workers
• The enterprise should preferably be involved in the product identified in the ODOP of the district. Other micro enterprises could also be considered;
• The applicant should have ownership right of the enterprise;
• Ownership status of enterprise could be proprietary / partnership firm;
• The applicant should be above 18 years of age and should possess at least VIII standard pass educational qualification;
• Only one person from one family would be eligible for obtaining financial assistance. The “family” for this purpose would include self, spouse and children
• Willingness to formalize and contribute10% of project cost and obtain Bank loan
• Cost of the land should not be included in the Project cost. Cost of the ready built as well as long lease or rental work shed could be included in the project cost. Lease rental of workshed to be included in the project cost should be for a maximum period of 3 years only.

Applications would be invited at the district level on an ongoing basis for Units, from those interested in availing the benefits under the Scheme. District Level Committee should study the report submitted by Resource Persons for each Unit and interview the interested persons. For the cases recommended by the District Level Committee, the DPR along with necessary documents should be submitted to the Banks for sanction of loan.

 Group category: FPOs / SHGs / Co-operatives

 Farmer Producer Organizations (FPOs)/Producer Cooperatives:

FPOs and Producer Cooperatives would be provided the following support:

• Grant @35% with credit linkage;
• Training support;
• It should preferably be engaged in processing of ODOP produce
• It should have minimum turnover of Rs.1 crore
• The cost of the project proposed should not be larger than the present turnover

 Self Help Groups (SHGs):

 Seed Capital

• Seed capital @ Rs40,000/- per member of SHG for working capital and purchase of small tools would be provided under the scheme.
• Priority would be given for SHGs involved in ODOP produce in giving seed capital
• Seed capital would be provided at the federation level of SHGs.
• This would be given as grant to the SHG federation by SNA/ SRLM.
• SHG federation would provide this amount as a loan to the members of SHGs to be repaid to the SHG.
  
  

Support to individual SHG member

as a single unit of food processing industry with credit linked grant @35% with maximum amount being Rs 10 lakh.

The SHGs should have sufficient own funds for meeting 10% of the project cost and 20% margin money for working capital or sanction of the same as grant from the State Government.

The SHG members should have for a minimum period of 3 years’ experience in processing of the ODOP product.

 Support for capital investment

Support for capital investment at federation of SHG level, with credit linked grant @35%.

 Training & Handholding Support to SHGs

Training & Handholding Support to SHGs: Assistance for training with the help of local resource persons in SRLM.

Support for common infrastructure

Support for common infrastructure would be provided to FPOs, SHGs, cooperatives, any Government agency or private enterprises. Credit linked grant would be available @ 35%.Support for ODOP product only.

Common infrastructure created under the scheme should also be available for other units and public to utilize on hiring basis for substantial part of the capacity.

The following common infrastructure would be funded under the Scheme:

• Premises for assaying of agriculture produce, sorting, grading, warehouse and cold storage at the farm-gate.
• Common processing facility for processing of ODOP produce.
• Incubation Centre.

Marketing and branding support

Marketing and branding support would be provided to groups of FPOs/SHGs/ Cooperatives or an SPV of micro food processing enterprises under the Scheme.

Eligible items for support

• Training relating to marketing to be fully funded under the scheme.
• Developing a common brand and packaging including standardization to participate in common packaging.
• Marketing tie up with national and regional retail chains and state level institutions.
• Quality control to ensure product quality meets required standards.
• Branding and marketing - should be at the district, regional or state level.
• Support for branding and marketing would be limited to 50% of the total expenditure.
• The proposal should relate to ODOP
• Minimum turnover of product to be eligible for assistance should be Rs 5 crore.

Online application for PM FME scheme: click here

Scheme for Interest Subvention to Nano Household Enterprises

This scheme has been introduced to promote the Nano and household enterprises in the state. The scheme intends to provide financial assistance in the form of interest subvention to nano and household enterprises on a reimbursement basis for the term loan availed by the unit. The units engaged in the manufacturing,services as well as job work can apply under the scheme.

Nano and Household unit

A unit which satisfies the following conditions;

• The fixed capital investment is 10 lakh or less,
• Engaged in the manufacturing,services or job work,
• In white and green category as per pollution control norms,
• Connected load is 5 HP or less.

Note

• Manufacturing units which are eligible to claim assistance under the Entrepreneur Support Scheme or any other schemes of Govt. of India or Govt. of Kerala cannot apply under the scheme.
• Unit which has availed special low rate of interest from Government Agencies are not eligible for further interest subvention under this scheme.

Benefit of the scheme

• The unit will be eligible for interest subvention to an extent of 6% per annum for the term loan availed by the unit on reimbursement basis for three years.
• For women and SC/ST enterprises, the interest subvention will be 8% for three years.
• The assistance shall be limited to the fixed percentage of the composite investment upon
  (a) plant & machinery,
  (b) other fixed assets including essential office equipments and
  (c) electrification. Cost of Land and Building shall not be included in the Fixed Capital Investment under this scheme.
• In the event of default of re-payment of loan with interest at the end of 1st year, the subvention will not be passed. The same is applicable for 2nd and 3rd years.

Negative List

Photo Studios and Colour Processing Centres, Breweries and Distilleries of all types, Saw mills, Soap Grade Sodium Silicate, Asbestos processing except units in which the quantum of asbestos used in the production process is less than 25% and environmental and occupational health hazards have been taken care of to satisfaction of authorities concerned, Metal Crushers including Granite Manufacturing units, All types of Steel Re rolling Mills, Units manufacturing iron ingots, Calcium Carbide, Cement manufacturing except units manufacturing cement from fly ash, Potassium Chlorate, Cashew industrial units, Power intensive units based on electro thermal/ electro chemical processor units where total power requirement exceeds 5000 KVA of contract load or where the cost of power is more than 33% of cost of production of the items manufacture except where the units generate their power requirement in excess of 5000 KVA of contract load by own captive power. 

How to Apply

      Application can be submitted online or in person to the Assistant District Industries Officer, Taluk Industries Office concerned with all supporting documents.

      To Apply Online Click Here

Kerala stressed MSMEs Revival & Rehabilitation Scheme

The Kerala stressed MSMEs Revival & Rehabilitation scheme intends to provide financial and other handholding support to the MSMEs which show signs of stress and to convert their non-productive assets into productive assets. The maximum assistance admissible for each unit, all reliefs and assistances put together, under the scheme will be limited to Rs. 5 Lakh.

Assistance/Relief Available from Government

Restructuring of existing loan account

If the bank is willing to restructure the existing loan account and extent additional term loan/working capital loan based on the Revival Project recommendations of the Expert Committee, the unit is eligible for the following one time Assistances. These assistances are also eligible for self financed units availing term loan/working capital loan as part of the Revival Package recommended by the Expert Committee.

a)   Margin Money Grant

50% of the margin insisted by the bank/Financial Institution towards additional working capital loan and term loan, will be payable as Grant Assistance limited to Rs 2 lakhs.

b)   Interest Subvention Assistance

 To provide a financial assistance in the form of interest subvention on a reimbursement basis for the additional term loan and additional working capital loan availed by the units based on the Revival Project Report recommended by the expert committee.  The interest subvention is 6% per annum subject to a maximum amount of Rs 1 lakh. The interest subvention is limited for one (first) year on the loan sanctioned by the financial institution/bank. 

Restart Expenses

The following one time assistances shall be payable as Re-start expenses based on the Revival Project recommendations of the Expert Committee.

• In cases where no term loan is availed for the purchase of brand new additional/balancing plant & machinery, 50% of the cost of Additional/Balancing Plant and Machinery limited to Rs 1.50 lakhs will be payable as one time assistance.
• 50% of the cost incurred for the inevitable repair and maintenance of existing Plant and Machinery and Building limited to Rs 1.00 lakh will be reimbursed.

Clearance of Statutory Dues

If there is statutory dues existing for the unit related to the agencies like KSEB, GST/Commercial Tax, Excise, Pollution Control Board etc. 50% of the dues limited to Rs 40,000 shall be payable as one time assistance based on the Revival Project recommendations of the Expert Committee.

To Apply Online Click Here

Cost of Revival Project Report

Cost of preparation of RPR will be reimbursed @100%, Rs.10,000/- per unit.

Assistance to Skilled Entrepreneurs Development Centres

Objectives

With the objectives of providing better employment opportunities to the skilled workers working in the unorganized sector in Kerala, transforming the unskilled workers into experts in the relevant field through skill development training, providing the required work tools to the workers and providing a better work-friendly environment to the society, the Government of Kerala aims to form one or more Industrial Co-operative Societies within the territorial boundaries of each Local Self Government Institution in the State and accordingly those working in different occupations has come forward to achieve the target. The Government has formulated a financial assistance scheme under the Department of Industries to promote such Industrial Co-operative Societies providing service of skilled and unskilled workers identified in various sectors to the needy people.

Beneficiaries:

Industrial co-operative societies formed to implement the objectives to find better employment opportunities for workers engaged in various types of employment in the unorganized sector and to bring skilled workers into the mainstream through skill development training are eligible for the benefit of this scheme. Moreover, the members of the Skill Enterprise Development Co-operative Societies should be from the technical, semi-skilled / unskilled workforce who has obtained technical skills certificates working in the unorganized sector.

Eligibility

• Industrial Co-operative Societies formed to implement the objectives of providing better employment opportunities to workers engaged in various types of employment in the unorganized sector and bringing unskilled workers to the mainstream through skill development training are eligible for the benefit of this scheme.
• Societies registered during or after the financial year 2019-2020.
• Societies have at least 50 members. In that, at least 25 members should be skilled workers and the remaining 25 members should be semi-skilled / unskilled workers. Nominal number of members is not taken into account for financial assistance.
• The societies applied for assistance under scheme should have a elected board of Directors and paid secretary.
• Each member should have been given at least 5 average working days in 3 months before date of application for financial assistance. At the same time, societies formed within 6 months are not eligible under this scheme.
• Only societies which maintain proper records as prescribed by the Registrar are eligible for financial assistance.
• There should be 100 active members to be eligible for the maximum benefit of Rs.2 lakh.

Financial Assistance under the scheme:

• The maximum benefit per society under this scheme will be Rs.2 lakhs. However, the amount of financial assistance will be determined only subject to the submitted documents, information and other terms and conditions of guidelines. 78% of the total allocation will be for fixed asset creation, 20% for working capital and 2% for training.
• The number of members in the group will also be taken into account to calculate the financial benefit to the group. There should be 100 active members to be eligible for the maximum benefit of Rs.2 lakh. Financial assistance will be decrease in proportion to the decrease in membership.
• Societies which do not receive maximum benefit due to less membership will be entitled to the remaining amount of financial assistance as long as the scheme exists, if the membership rises above the prescribed criteria. But in any case, it will not allow more than two times.
• The societies which availed the assistance for raising fixed capital assets should be calculated as 80% of the amount and balance amount other than grant amount may be arranged by the society. The amount received by the group for raising fixed capital assets should be calculated as 80% of the amount and the remaining 20% should be found on its own. The societies have to find its own amount equivalent to the amount received as working capital assistance. Expenditure incurred for the purpose of land and building is not taken into account for financial assistance of fixed assets. Tools, furniture, electrical and electronics equipment and essential machinery will be considered. The cost of fixed assets acquired prior to the commencement of the scheme, will be considered for financial assistance and the amount spent will be refunded. However, the documents should be produced properly.
• Working capital will be sanctioned at the rate of Rs.1000 / - per number of active members.
• The grant sanctioned to the society shall be released through the bank A/C jointly by the society & General Manager, District Industrial Centre and will be withdrawn only with the permission of the General Manager, DIC.

Check List:

• Copy of previous year Audit certificate/Financial statement
• List of work days of each member in previous year(monthly)
• Details of required components for financial assistance 

Scheme Related GO's and Guidlines

• G.O.(Rt)No.821/2021/ID Dated:09.08.2021
• G.O.(Rt)No.373/2020/ID Dated:04.06.2020
• GuideLines

How to apply

Apply online: https://schemes.industry.kerala.gov.in .

Scheme for Interest Subvention on Term Loan and Working Capital Loan

The scheme has been introduced to assist the MSME units which were badly affected due to the economic crisis in the wake of COVID-19 pandemic. The scheme intends to give financial assistance in the form of interest subvention for 12 months for the new/ additional term loan and/or working capital loan availed by the units from 1st April 2019 to 31st December 2021.

Eligibility for applicant units

• Should be an MSME in the manufacturing or job work category established in the state.
• Should have filed Udyam with the competent authority, after commencing the commercial production. .
• The unit should have been operational at least for a period of 3 months within a period of 6 months prior to the date of sanction of bank loan. .

Benefit under the scheme

• The total assistance under the scheme shall be limited to an amount of Rs.1,20,000/- per applicant unit including assistance for term loan and/ or working capital loan and it can be availed only once.
• All MSMEs in the manufacturing/ job work category functioning in Kerala will be eligible to avail interest subvention on fresh/ additional working capital loan up to a maximum of Rs.60,000/- per unit.
• All MSMEs in the manufacturing/ job work category functioning in Kerala will be eligible to avail interest subvention on fresh/ additional term loan up to a maximum of Rs.60,000/- per unit.
• The assistance shall be limited to 50% of the interest paid by the unit to the bank/ financial institution, up to a period of 12 months from the date of disbursement of 1st installment to the loan.
• The period of availing of fresh/ additional term loan and/ or working capital loan should be in between 01.04.2019 to 31.12.2021.
• The assistance shall be released to the loan account of the applicant unit through the financial institution concerned on quarterly reimbursement basis.

How to apply

Application can be submitted online or in person to the Assistant District Industries Officer, Taluk Industries Office concerned with all supporting documents.

Scheme Related GO's

• G.O.(RT)No.1200/2021/ID dated 30.10.2021
• G.O.(RT)No.362/2020/ID dated 02.06.2020
• G.O.(Ms)No.56/2020/ID dated 20.05.2020

Apply Online Click Here