About this programme
A scheme by the Micro, Small and Medium Enterprises Department of Tamil Nadu designed to help unemployed youth become self-employed by setting up manufacturing or service enterprises. The programme provides financial assistance in the form of bank loans (90-95% of project cost) combined with government subsidy (25% of project cost, capped at Rs 1.25 lakh). Eligible unemployed youth can avail loans of up to Rs 15 lakh for manufacturing or Rs 5 lakh for service/trading projects. It is run by Government of Tamil Nadu.
A subsidy reduces a specific cost — typically reimbursed or adjusted after you incur and document the expense, rather than paid upfront. The amount and form of support that actually apply to you depend on the programme’s rules and how your application is assessed — they are not fixed for every applicant.
It is aimed at businesses in manufacturing and service/trading sectors. Like most government programmes, it has its own eligibility conditions, documentation and application window, and these terms are revised from time to time. Because of that, it is worth confirming the current eligibility, amount and deadline on the official programme page before you invest time in applying.
How it works
The applicant applies online for both loan and subsidy. The bank loan component covers 90-95% of project cost (including the 25% government subsidy). The State Government provides a direct subsidy of 25% of project cost with a maximum ceiling of Rs 1.25 lakh, which the bank can claim. Loan repayment tenure is typically 5 years as per RBI guidelines or as fixed by the lending bank. Completion of Entrepreneurship Development Programme (EDP) training is mandatory.
Who can apply
Unemployed youth aged 18-35 years (General category) or 18-45 years (SC/ST/MBC/BC/Minorities/Ex-Servicemen/Differently abled/Transgender) who are permanent residents of Tamil Nadu for the last 3 years. Must have passed 8th standard minimum. Family annual income must not exceed Rs 5 lakh. Applicant must not have availed loan or subsidy under any other State/Central Government scheme.
How to apply
- Complete mandatory Entrepreneurship Development Programme (EDP) training
- Submit online application via https://www.msmeonline.tn.gov.in/uyegp/
- Upload required documents (identity proof, education proof, residency documents, EDP completion certificate)
- Bank assessment and loan processing (average 107 days)
- Receive loan and subsidy disbursement upon approval
Documents you’ll typically need
- Identity proof (Election ID Card or Aadhaar card)
- Educational qualification proof (Transfer Certificate or School Record Sheet for 8th standard pass)
- Ration Card or Nativity Certificate from Thasildhar/Aadhaar card xerox/Election voter ID card xerox
- EDP training completion certificate
- Project report and detailed business plan
- Bank statement (if applicable)
The exact checklist depends on the programme and your specifics.
Frequently asked
What is the difference between the loan and subsidy under UYEGP?
The bank provides a loan of 90-95% of project cost, and the State Government provides a subsidy of 25% of project cost (not exceeding Rs 1.25 lakh). The subsidy is claimed by the bank.
Is EDP training mandatory?
Yes, Entrepreneurship Development Programme (EDP) training is mandatory for all applicants under UYEGP.
What is the maximum loan amount available?
For manufacturing projects, the maximum loan is Rs 15 lakh. For service or trading projects, the maximum is Rs 5 lakh.
Who can apply for UYEGP?
Unemployed youth aged 18-35 years (General) or 18-45 years (SC/ST and other reserved categories) who are permanent residents of Tamil Nadu and meet income and education requirements.
Reviewed July 2026. Government programmes change — confirm current eligibility, amounts and deadlines on the official programme page before you apply. CapEasy is a private consultancy and is not affiliated with any government authority.