The PMFME Scheme was launched with the objective of providing financial, technical, and business support for the formalization of micro food processing enterprises. This initiative is designed to promote the establishment of small processing units that utilize local agricultural produce, thereby enhancing value addition and ensuring better returns for farmers.

• Promotion of Micro Food Processing Units: The scheme aims to encourage the formation and growth of small-scale food processing units in rural and semi-urban areas.
• Boosting Farmers’ Income: By aiding in the creation of processing units using locally available raw materials, the scheme seeks to ensure better prices for farmers’ produce.
• Generation of Employment Opportunities: The establishment of these units is expected to create job opportunities for local communities, particularly in rural areas.
• Focus on Women and SC/ST Entrepreneurs: The PMFME Scheme places emphasis on supporting women entrepreneurs and those from Scheduled Castes and Scheduled Tribes, promoting inclusivity and economic empowerment.
• Enhancing Food Safety Standards: The scheme encourages adherence to quality and safety standards, ensuring the production of high-quality processed foods.

The PMFME Scheme boasts a Rs. 10,000 crore outlay, targeting coverage for 2,00,000 enterprises over a 5-year period (2020-21 to 2024-25).

The funding structure involves a 60:40 cost-sharing between the Central and State Governments, with a 90:10 ratio in partnership with North Eastern and Himalayan States.

Similarly, Union Territories with legislatures follow a 60:40 ratio, while 100% funding is provided by the Center for other Union Territories. Notably, in the scheme’s inaugural year (2020-21), all expenditures, whether incurred by the Centre or the States, are entirely borne by the Central Government. Expenses from this first year will be adjusted according to the ratios for the subsequent four years’ fund transfers to the States.

• Micro Enterprises Support: Financial incentives and credit-linked subsidies are provided to eligible units to facilitate their establishment and growth.
• Credit Linked Subsidy: Subsidies for loans obtained by these enterprises for expansion or modernization.
• Capacity Building: Training programs are conducted to enhance the skills of individuals engaged in food processing.
• Promotion of Innovation: Encouraging innovation and technology adoption for efficiency and quality enhancement.
• Marketing and Branding Support: Guidance and support are offered for packaging, branding, and marketing to improve the marketability of products.
• Technical Upgradation: Assistance is provided for modernizing equipment and upgrading technology in food processing units.

• Micro Enterprises: Micro food processing units, including individual entrepreneurs, groups of entrepreneurs, and cooperatives, are eligible to apply. Defined by investment limits in machinery and equipment.
• Existing Units: Units involved in processing perishable fruits and vegetables, grains, pulses, oilseeds, spices, dairy products, etc., can avail of benefits under the scheme. Upgradation and expansion of existing micro food processing units are considered.
• Cooperative Societies, Self-Help Groups (SHGs), Individuals: Open to various organizational structures involved in food processing.

• Nodal Agencies: State governments and designated agencies oversee the implementation.
• Application Process: Typically involves online registration, submission of project proposals, and verification.
• Monitoring and Evaluation: Regular monitoring of the progress and impact of the scheme.

• Economic Growth: Boosting income and employment opportunities, especially in rural areas.
• Technology Adoption: Encouraging the use of modern technology for efficiency and quality improvement.
• Market Access: Facilitating better access to markets for processed food products.
• Support to Food Processing Units

• Financial Threshold: FPOs aiming to benefit from the scheme should maintain a minimum turnover of Rs. 1 crore, ensuring a reasonable business scale.
• Project Size Alignment: The proposed project cost for FPOs should align with or not exceed their current turnover, ensuring a proportionate investment plan.
• Financial Contribution: FPOs should demonstrate sufficient internal resources to cover 10% of the project cost and provide margin money for working capital, ensuring their commitment and financial stability.

• 35% Credit-Linked Grant for Upgradation: Existing unorganized food processing units can access a credit-linked grant covering 35% of the project cost, capped at Rs. 10.0 lakh, to facilitate their modernization.
• Capital Expenditure Grant for SHGs/FPOs/Cooperatives:Self-Help Groups (SHGs), Farmer Producer Organizations (FPOs), and cooperatives are eligible for a credit-linked grant of 35% of the project cost towards capital expenses.
• Working Capital Support: Individuals engaged in food processing can receive seed capital of Rs. 40,000 as part of the financial assistance.
• Common Infrastructure Grant: Provision for a credit-linked grant of 35% of the project cost to develop common infrastructure facilities shared by multiple units.
• Marketing & Branding Support: Up to 50% of the expenditure is covered to support marketing and branding initiatives, enhancing the visibility of processed food products. This support mechanism aims to enhance market visibility and consumer outreach for these enterprises through strategic branding and marketing endeavors, fostering their growth and competitiveness within the industry.
• Cluster-Based Support: Encourages a cluster approach for joint packaging and branding initiatives, ensuring a unified market presence.
• Quality Assurance: Emphasizes adherence to quality control, standardization, and food safety measures essential for retail sale to consumers.
• Active Participation: Requires active involvement from FPOs, SHGs, and Cooperatives to meet minimum volume criteria for support eligibility.
• State Nodal Agency Assistance: Offers support up to Rs.5 lakh from the State Nodal Agency for preparing Detailed Project Reports (DPR) related to branding and marketing proposals.
• Financial Limit: The support for branding and marketing is limited to 50% of the total expenditure, subject to a maximum prescribed limit.
• National-Level Initiatives: Proposals from states, national-level institutions, or partner organizations for branding and marketing vertical products at a national level are eligible for support.
• Exclusion of Retail Outlets: Notably, the scheme doesn’t extend support for establishing retail outlets, focusing primarily on marketing and branding initiatives for the products.

• Identification of Unique Products: Each district identifies its distinctive products through a rigorous selection process, considering factors like local demand, market potential, and traditional expertise.
• Skill Development and Technology Integration: PMFME supports skill development programs and technology adoption tailored to the specific needs of ODOP products, aiding in quality improvement and productivity enhancement.
• Financial Assistance: Micro food processing units focusing on ODOP products are eligible for financial aid under PMFME, aiding in their establishment, expansion, or modernization.

• Eligible Entities: SHGs, FPOs, cooperatives, or Special Purpose Vehicles (SPVs) can apply for branding and marketing support under the Scheme.
• Preparation of Detailed Project Report (DPR): Applicants are required to prepare a Detailed Project Report (DPR) outlining their branding and marketing proposal. This DPR should be submitted to the State Nodal Agency (SNA) for evaluation.
• Evaluation by State Nodal Agency (SNA): The SNA conducts an appraisal of the proposal and submits it to the State Level Approval Committee (SLAC) for further assessment.
• Approval by State Level Approval Committee (SLAC): The SLAC reviews and assesses the proposal submitted by the SNA. Upon approval, the proposal is forwarded to the Ministry of Food Processing Industries (MOFPI).
• Approval by MOFPI: The MOFPI evaluates the proposal and, upon approval, sanctions the support for branding and marketing.
• Loan Sanction: Once approved by MOFPI, the proposal is forwarded to a designated bank for the sanction of a loan to facilitate branding and marketing initiatives.
• Similar Process for Infrastructure Creation: The same procedural steps outlined above should be followed for applying for support concerning the creation of common infrastructure.

This streamlined process ensures that eligible entities can access support for branding and marketing, as well as for creating common infrastructure, by following a structured application and evaluation process, leading to eventual approval and facilitation of funds or loans for the proposed initiatives.

This scheme serves as a beacon of hope for the farming community and micro-entrepreneurs, offering them avenues for growth, prosperity, and sustainable development.