The Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) Scheme is a Centrally Sponsored Scheme implemented by the Ministry of Food Processing Industries (MoFPI). It was launched on June 29, 2020, under the Atmanirbhar Bharat Abhiyaan. The scheme was created to address the challenges faced by the unorganised food processing sector, which comprises approximately 25 lakh units and accounts for 74% of employment in the sector. Its primary goal is to formalise these micro-enterprises and enhance their competitiveness, supporting the 'Vocal for Local' vision.
The scheme works by providing financial, technical, and business support. A key provision is the credit-linked capital subsidy of 35% of the eligible project cost, with a maximum ceiling of ₹10 lakh per unit for individual micro-enterprises. The beneficiary must contribute a minimum of 10% of the project cost. It adopts the One District One Product (ODOP) approach to promote cluster-based processing and marketing. For members of Self-Help Groups (SHGs), a seed capital of ₹40,000 per member is provided for working capital and small tools. The expenditure is shared between the Centre and States in a 60:40 ratio, which is a standard for Centrally Sponsored Schemes.
The PMFME Scheme connects to the broader ecosystem of rural development and enterprise promotion, supporting Farmer Producer Organizations (FPOs) and Producers Cooperatives. It converges with schemes like the National Rural Livelihood Mission (NRLM) and the Start-up Village Entrepreneurship Programme (SVEP). While initially planned for five years from 2020-21 to 2024-25, the scheme has been recently extended up to the 2025-26 financial year.