PMFME Scheme: Meaning, Full Form, Eligibility, Benefits and Application Process

Explore all about PMFME scheme, it’s eligibility criteria and benefits.
Understanding PMFME Scheme
3 min
11 April 2024

The Pradhan Mantri Formalisation of Micro Food Processing Enterprises Scheme (PMFME) represents a significant stride towards revitalising and formalising India’s micro food processing sector. Launched by the Ministry of Food Processing Industries, Government of India, the scheme aims to enhance the competitiveness of existing micro food processing enterprises. This initiative is poised to be a game-changer for small-scale food processors, offering a comprehensive package of financial assistance, training, and support to improve their productivity, quality, and profitability. For entrepreneurs navigating the competitive market, business loans offer a strategic supplement to manage and scale operations efficiently.

Understanding the PMFME Scheme

The PMFME scheme is a part of the Atmanirbhar Bharat Abhiyan, focusing on empowering grass-root level food processors by providing them with the tools, knowledge, and resources needed to upgrade their operations. The scheme operates on a One District One Product (ODOP) approach, which encourages the production of a single flagship product per district, leveraging the local agricultural produce. By doing so, it aims to preserve, develop, and promote local cuisines and create a brand around them, thus opening new avenues for growth.

Key features of the PMFME scheme include credit-linked capital subsidy (35% of the eligible project cost with a maximum cap), seed capital to self-help groups (SHGs) for loan to members, and support for marketing and branding. It also envisages training and technical support, ensuring that enterprises can maintain standards and innovate.

One District One Product (ODOP) Under PMFME Scheme

The PMFME scheme has embraced the One District One Product (ODOP) strategy to enhance the procurement of inputs, common services, and marketing of products. This initiative aims to establish a framework for aligning support infrastructure and developing the value chain.

Through the ODOP approach, states will identify and promote specific food products within each district. These products may include perishable agricultural crops, cereal-based items, or any food product predominantly produced in the area.

Examples of products under the ODOP initiative include tomatoes, litchis, potatoes, millet-based goods, fishery products, mangoes, animal feed, poultry, and meat. Additionally, traditional Indian herbal products such as turmeric, amla, honey, and minor forest products from tribal regions will also be supported by this scheme. The ODOP approach will provide robust infrastructure facilities, along with branding and marketing assistance.

PMFME Scheme list

The PMFME Scheme is a multi-faceted program designed to uplift the micro food processing sector. It encompasses:

  • Common Infrastructure Development: Establishing facilities that benefit clusters of food processing units.
  • Branding and Marketing: Assisting enterprises in developing brand identity and marketing strategies.
  • Capacity Building and Research: Offering training and research support to improve production quality and efficiency.
  • Support to Food Processing Units: Providing financial aid to individual micro food processing units to enhance their competitiveness.
  • Seed Capital for SHGs: Empowering Self-help Groups with seed capital to facilitate loans to their members.

PMFME Scheme subsidy

The PMFME Scheme subsidy is a Government of India initiative aimed at supporting micro food processing enterprises. Here's how it works:

  • Financial assistance: The scheme provides financial assistance to eligible enterprises for technology upgrades, infrastructure development, and capacity building.
  • Technology upgrades: Subsidy funds can be used to invest in modern equipment and machinery to enhance production efficiency and product quality.
  • Infrastructure development: Enterprises can utilize the subsidy to improve their infrastructure, including building and upgrading facilities for food processing.
  • Capacity building: The scheme supports capacity building initiatives such as training programs to enhance the skills and knowledge of personnel involved in food processing.
  • Competitiveness boost: By availing of the subsidy, micro food processing enterprises can enhance their competitiveness in the market, leading to increased market share and profitability.
  • Sustainability: The scheme promotes sustainable growth in the food processing sector by enabling enterprises to adopt modern technologies and practices.
  • Market reach expansion: With improved infrastructure and product quality, enterprises can expand their market reach and explore new business opportunities.

Overall, the PMFME Scheme Subsidy plays a vital role in facilitating the growth and formalisation of micro food processing enterprises in India, thereby contributing to the development of the food processing industry.

Leveraging business loans for growth

While the PMFME scheme provides a solid foundation, integrating business loans can further empower micro food processing enterprises. Business loans can supplement the financial assistance from the PMFME scheme, covering additional expenses that are critical for scaling up operations. These loans can be used for a variety of purposes, including purchasing new equipment, upgrading technology, expanding facilities, or even for working capital management.

Financial institutions and banks offer specialised business loans tailored for the food processing sector, with attractive interest rates and repayment schedules. Entrepreneurs should leverage these loans strategically to bridge any funding gaps, ensuring that their enterprise can grow without financial constraints.

Benefits and eligibility of PMFME Scheme

Managing expenses effectively is crucial for the success of any micro food processing enterprise. The PMFME scheme, coupled with business loans, offers a financial backbone, but entrepreneurs must also adopt sound financial management practices. This includes:

  • Budgeting and Cost Control: Keeping a close eye on expenditures and identifying areas where costs can be minimised without compromising on quality.
  • Investing in Technology: Utilising part of the funds to invest in technology that can automate processes, reduce wastage, and increase efficiency.
  • Market Research and Branding: Allocating resources towards understanding market trends and consumer preferences, and using this knowledge to create strong brand identities.
  • Quality and Compliance: Ensuring compliance with food safety and quality standards, which is critical for gaining consumer trust and accessing broader markets.

Opting for the PMFME Scheme offers numerous benefits, including financial subsidies, training programs, and market access. This scheme is particularly advantageous for entrepreneurs looking to formalise their operations and tap into a larger consumer base. Eligibility criteria are designed to be inclusive, targeting existing micro food processing enterprises seeking to upgrade or expand their operations.

Application process for the PMFME Scheme

The application process for the PMFME Scheme is streamlined for convenience. Interested entrepreneurs can apply online through the PMFME portal (PMFME login), where the application form and detailed instructions are available. For those preferring offline methods, applications can be submitted through local nodal agencies. The process involves submitting a detailed project report and requisite documents, following which the application is reviewed and processed.

PMFME online application

If you want to apply for the PMFME scheme online, follow these steps:

  1. Visit the official PMFME website.
  2. Click on ‘Login’ and then select ‘Applicant Registration.’
  3. Fill in the required information on the application form and click ‘Register.’
  4. Return to the PMFME website, click on ‘Login,’ and select the ‘Applicant Login’ option.
  5. Enter your User ID and password, then click ‘Submit.’
  6. From the dashboard, select the ‘Apply Online’ option.
  7. Complete the relevant form with all necessary details and click ‘Submit.’

The PMFME scheme is designed to support the unorganised food processing sector, which consists of 2.5 million units. By leveraging this scheme, these units will be better equipped to tackle challenges related to modern technology, equipment, institutional credit, training, and more, ultimately contributing to the improvement of the sector and the overall economy.

Conclusion

The Pradhan Mantri Formalisation of Micro Food Processing Enterprises Scheme (PMFME) is a landmark initiative that offers a lifeline to micro food processors across India. By providing financial support, training, and market access, it lays the groundwork for these enterprises to thrive. However, to fully realise their growth potential, entrepreneurs should also consider integrating business loans into their financial strategy. This dual approach can provide the necessary capital infusion to manage expenses effectively and scale operations.

As the food processing sector continues to evolve, initiatives like the PMFME scheme and the strategic use of business loans will be instrumental in driving the growth of micro enterprises. By embracing these opportunities, entrepreneurs can build sustainable businesses that contribute to the economic fabric of India, creating jobs and promoting regional cuisines on a national and international stage.

Other Government Schemes

Udyogini Scheme

MSME Loan Scheme

Standup India Scheme

Startup India Seed Fund Scheme

Eco Mark Scheme

CGTMSE Scheme

Pradhan Mantri MUDRA Yojana

PM Svanidhi Scheme

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Frequently asked questions

What is the maximum loan amount under Pmfme?
Under PMFME Scheme, the maximum loan amount you can avail varies depending on your business requirements and eligibility criteria. It is advisable to consult with the relevant authorities or financial institutions to determine the maximum loan amount you qualify for under the scheme.
What are the documents required for PMFME scheme?
For the PMFME scheme, you'll need documents like Aadhar Card, Bank passbook, Valid rent agreement, Current loan statement, GST return, GST certificate, and business registration papers. These documents help streamline the application process and ensure eligibility for the scheme.
Who is eligible for PMFME subsidy?
You are eligible for the PMFME subsidy if you are above 18 years of age, and you own a micro food processing. This subsidy aims to support small businesses in the food processing sector by providing financial assistance for upgrading equipment, technology, and infrastructure.
What products are under the PMFME scheme?

The PMFME scheme supports a wide range of food products to boost the unorganised food processing sector in India. This includes perishable agricultural products, such as fruits and vegetables, along with cereal-based products. Examples of eligible items include tomatoes, litchis, potatoes, and various fishery products. The scheme also extends support to traditional Indian herbal items like turmeric, amla, and honey. Additionally, it encompasses minor forest products in tribal areas, promoting the production and processing of these goods to enhance local economies and livelihoods.

What is the processing fee for PMFME?

The processing fee for the PMFME scheme is structured to be accessible for applicants. It is typically charged at ₹250 per lakh of the loan amount or part thereof, plus applicable GST. This nominal fee is designed to encourage more micro food processing units to apply for assistance under the scheme, ensuring that financial support is available to a larger number of participants. This approach helps streamline the application process while providing crucial funding for the growth of the food processing sector.

What is the interest rate of the PMFME scheme?

The PMFME scheme offers competitive interest rates to encourage micro food processing enterprises to seek financial support. The specific interest rate may vary depending on the financial institution providing the loan, but it is generally designed to be affordable, with rates often in the range of 8% to 12%. This ensures that borrowers can manage repayment while benefiting from the scheme's resources for upgrading and expanding their operations. The aim is to facilitate the formalisation and growth of micro food processing units across the country.

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