PMFME Scheme Expands Credit, Market Access Support For Micro Food Enterprises

(MENAFN- KNN India) New Delhi, Jan 31 (KNN) The Government of India continues to strengthen the micro food processing sector through targeted financial assistance, market access support and institutional handholding under the Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) Scheme, said Minister of State (MoS) for Food Processing Industries, Ravneet Singh, in a written reply in Lok Sabha.

Credit Access and Sanction Trends

The MoS Food Processing stated that success rate of loan sanctioning under the PMFME scheme currently stands at 42 percent, which is in line with other government-sponsored credit-linked schemes.

While banks sanction projects based on their internal lending policies, the Minister said regular coordination meetings are held with lending institutions and State Governments to address challenges faced by micro food processing enterprises.

Support for individual and group category micro enterprises is provided through a credit-linked capital subsidy of 35 percent, with a maximum ceiling of Rs 10 lakh per unit, for upgrading existing units or setting up new enterprises.

Support for SHGs, FPOs and Cooperatives

The scheme also provides targeted support to Self Help Groups (SHGs), Farmer Producer Organisations (FPOs) and cooperatives. This includes seed capital assistance of Rs 40,000 per SHG member, subject to a maximum of Rs 4 lakh per SHG federation, to meet working capital needs and purchase small tools.

For common infrastructure projects, a 35 percent credit-linked subsidy, capped at Rs 3 crore, is available to support facilities that can be accessed by multiple units on a hiring basis, improving scale efficiencies and productivity.

Branding, Marketing and Capacity Building

Under the Branding and Marketing component, groups of FPOs, SHGs, cooperatives or Special Purpose Vehicles are eligible for grants of up to 50 percent of the eligible project cost.

The support focuses on developing common brands, quality control, standardisation, packaging and adherence to food safety norms, following a cluster-based approach.

To improve market access, the Food Precessing Ministry has signed a Memorandum of Understanding with the Government e-Marketplace (GeM) portal, enabling PMFME-supported units to sell their products through the public procurement platform.

Capacity-building initiatives include Entrepreneurship Development Programmes and continuous handholding by District Resource Persons, who are deployed at the district level to assist beneficiaries through implementation.

Monitoring and Implementation

The Minister said implementation is closely monitored through regular review meetings with banks and State Governments, as well as discussions at the Department of Financial Services and State Level Bankers' Committee meetings.

Monitoring has been further strengthened through the PMFME Management Information System, which captures district-wise data on applications, sanctions, disbursements and enterprise-level outcomes.

(KNN Bureau)

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