Rajiv Gandhi Swavlamban Rojgar Yojna Delhi: Business Loans

The Rajiv Gandhi Swavlamban Rojgar Yojna (RGSRY) is a flagship state-funded self-employment scheme designed, developed, and promoted by the Delhi Khadi & Village Industries Board (DKVIB), with the active support of the Government of NCT of Delhi. The scheme provides subsidized financial backing to unemployed youth, school dropouts, artisans, trained professionals, and skilled technocrats who wish to run their own enterprises. By combining accessible loan-based financial support with a structural subsidy, the scheme ensures that beneficiaries have the foundational capital to establish durable, independent livelihoods within the capital city.

Read more: Debt to Income Ratio: Why It Matters for Personal Loans

Core Objectives

The fundamental objective of the scheme is to bring down the unemployment rate among Delhi’s youth and skilled workers by steering them away from wage-seeking and toward entrepreneurship. It pays special attention to individuals who hold vocational skills, artisan craftsmanship, or professional training but lack the initial seed capital to launch a business. By providing structured credit, the government aims to stimulate grassroots economic growth and self-reliance.

Key Features and Financial Benefits

The Rajiv Gandhi Swavlamban Rojgar Yojna goes beyond standard loans by offering targeted financial relief and a flexible repayment structure:

• Substantial Loan Limit: The scheme provides loans up to a maximum of ₹3,00,000 for both proposed new ventures and functioning units looking to expand.
• Government Subsidy: Beneficiaries receive a government subsidy of 15% of the project cost, subject to a maximum ceiling of ₹7,500 per entrepreneur. Note: This subsidy is not given as immediate cash; it is adjusted directly into the borrower’s loan account after a successful lock-in period of two years from the date of disbursement.
• Low Beneficiary Contribution: To ensure the borrower is invested in the business, a minimal personal contribution is required:
  • General Category: 10% of the total project cost.
  • Weaker Sections (SC/ST/OBC/Women/PwD/Ex-Servicemen): Only a 5% contribution is required.
• Moratorium & Repayment: The scheme offers a highly forgiving 12-month moratorium (grace period) before the principal recovery begins. The total loan must be repaid in equal quarterly installments over a period of 5 years.
• Sector Coverage: Supports a wide array of businesses, including Tiny/Cottage Industries (Secondary Sector), Trade, Transport, Hostels (Tertiary Sector), and general Services.

Eligibility Criteria

To ensure funds reach the appropriate demographics, the DKVIB enforces specific eligibility rules:

• Residency & Location: The applicant must be a resident of Delhi, and the proposed business unit must be established within the National Capital Territory (NCT) of Delhi.
• Age Limit: The applicant must be aged between 18 and 50 years.
• Target Demographic: Must be unemployed or actively looking to set up self-employment. This includes school/college dropouts, individual entrepreneurs, traditional artisans, and candidates who have passed out from recognized technical/professional institutes.
• Scale of Business: The project must fall within the investment limits of a Small-Scale Industrial unit as prescribed by the Central Government.

General Exclusions

Applications will be rejected if they fall under any of the following categories:

• Geographical Limits: Non-residents of Delhi or businesses operating outside the NCT of Delhi are strictly ineligible.
• Defaulters: Anyone who has defaulted on a prior government loan or commercial bank loan.
• Prior Scheme Beneficiaries: Individuals who have previously availed of similar government self-employment loans and failed to repay them, or those whose previous loan amounts were found to be misutilized.
• Restricted Businesses: Certain tertiary businesses are excluded (e.g., restaurants or eateries that serve liquor or meat).
• Misutilization Penalty: If the loan is found to be used for purposes other than the stated business plan, the government will recover the entire subsidy and charge a severe 18% penal interest on the amount.

Step-by-Step Application Process

1. Obtain the Form: Visit the nearest office of the Delhi Khadi & Village Industries Board (DKVIB), the Social Welfare Department, or access the Delhi e-district portal online.
2. Prepare the Project Plan: Draft a concise but accurate business proposal outlining what the business will do, the equipment needed, and projected revenues.
3. Submit Documentation: Fill out the application form and attach all required KYC and educational documents.
4. Committee Evaluation: A designated screening committee will evaluate the viability of the business proposal and verify the applicant’s credentials.
5. Sanction & Disbursement: Upon approval and submission of post-dated cheques for future repayment, the loan is sanctioned and disbursed directly to the applicant’s bank account.

Documents Required

Ensure your application file contains self-attested copies of the following:

• Identity Proof: Aadhaar card, Voter ID, or PAN card.
• Residence Proof: Valid proof of permanent residence in Delhi (Ration card, utility bill, or domicile certificate).
• Educational/Skill Proof: School leaving certificate, vocational training certificate, or professional degree.
• Category Certificate: Valid SC/ST/OBC or Disability certificate, if applying for the reduced 5% contribution.
• Business Plan: A written project report detailing the proposed stall, shop, or manufacturing activity.
• Financials: Active bank account details (passbook copy or canceled cheque).
• Photographs: Recent passport-size photographs of the applicant.

Frequently Asked Questions (FAQ)