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Seed Capital Module for SHGs

  • 28 Sep 2021
  • 3 min read

Why in News

Recently, the Ministry of Food Processing Industries has launched the Seed Capital Module under Pradhan Mantri Formalisation of Micro food processing Enterprises (PMFME) to help Self Help Groups (SHGs).

Key Points

  • About:
    • It was launched on Deendayal Antyodaya Yojana-National Urban Livelihoods Mission (DAY-NULM) MIS (Management Information System) Portal for seed capital assistance to members of urban Self Help Groups working in the food processing sector in India.
    • The seed capital portal can be accessed for SHGs to avail the seed capital assistance.
      • Seed capital is the money raised to begin developing an idea for a business or a new product.
    • SHGs will be sensitized and motivated about the PMFME scheme to avail the benefits of seed capital for purchasing small tools and working capital.
  • PMFME Scheme
    • It is a Centrally Sponsored Scheme that was launched under the Atmanirbhar Bharat Abhiyan.
    • It 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 provide support to Farmer Producer Organizations, Self Help Groups, and Producers Cooperatives along their entire value chain.
    • With an outlay of Rs.10,000 crore over a period of five years from 2020-21 to 2024-25, the scheme envisions to directly assist the 2,00,000 micro food processing units for providing financial, technical, and business support for upgradation of existing micro food processing enterprises.
  • Benefits under PMFME Scheme:
    • Capital assistance of Rs. 40,000 per SHG member.
    • Credit linked subsidy for capital investment up to 35% with a ceiling of Rs. 10 lakh.
    • Credit linked grant support up to 35% for establishing common infrastructure.
    • Handholding support for DPR (Detailed Project Report) preparation.
    • Capacity building and training support.
  • Other Schemes Related to SHGs:


  • It is Centrally Sponsored Scheme, launched in 2014, aims to uplift urban poor by enhancing sustainable livelihood opportunities through skill development.
  • Its intended beneficiaries are urban poor (street vendors, slum dwellers, homeless, rag pickers), unemployed and differently-abled. It provides skill training and employment to these people.
    • It also provides subsidies to urban poor i.e. interest subsidy of 5% – 7% for setting up individual micro-enterprises with the loan of up to 2 lakhs and for group enterprises with a loan limit of up to Rs.10 lakhs.

Source: PIB

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