PM Formalisation of Micro Food Processing Enterprises (PM FME)

✦Key Features

• Budget: ₹10,000 crore (2020-25); credit-linked subsidy 35% of project cost (max ₹10 lakh)
• Target: 2 lakh micro enterprises formalized and credit-linked
• ODOP cluster approach: each district focuses on one specific food product
• SHG seed capital: ₹40,000 for working capital and equipment
• Skill training: 5 lakh persons trained in enterprise management and food safety
• FSSAI food safety compliance: micro enterprises get technical support
• Products: pickles, papad, honey, spices, oils, makhana, tribal products

✓Eligibility Criteria

• Existing individual micro food processing units that are currently operational and need formalization are eligible.
• Farmer Producer Organizations (FPOs), Self Help Groups (SHGs), and Producers Cooperatives involved in food processing activities can apply.
• Individual applicants must be above 18 years of age and should ideally possess at least an 8th-grade educational qualification.
• Only one person from a family is eligible to receive financial assistance for setting up or upgrading a unit.
• The enterprise must be involved in the food processing sector, with preference given to those following the One District One Product (ODOP) cluster approach.

★Benefits

• Individual micro-enterprises receive a credit-linked capital subsidy of 35% of the eligible project cost, subject to a maximum of Rs. 10 lakh.
• Self Help Groups are provided with seed capital of Rs. 40,000 per member for working capital and the purchase of small tools.
• The scheme offers comprehensive support for marketing and branding to help micro-units integrate with organized supply chains.
• Beneficiaries gain access to common infrastructure facilities such as testing laboratories, storage, and packaging centers through cluster-level support.

▶Application Process

• Applicants must register and submit their project proposals through the official PMFME online portal.
• District Resource Persons (DRP) are assigned to provide handholding support for preparing the Detailed Project Report (DPR) and navigating the loan process.
• The District Level Committee (DLC) reviews the applications and recommends them to the State Level Approval Committee for further processing.
• Applications for credit-linked subsidies are forwarded to the respective banks for appraisal and sanctioning of the term loan.
• Upon bank approval, the subsidy amount is released and kept in a separate mirror account until the completion of the project.

₹ Budget Allocation

10000

Funding Ratio (Centre:State): 60:40 (Center:State); 90:10 for NE/Himalayan States; 100% for UTs without legislature.

Historical Context

Launched in June 2020 as part of the Atmanirbhar Bharat Abhiyan to support 2 lakh micro-enterprises over five years (2020-2025).