KVIC (Khadi and Village Industries Commission) is a statutory body constituted by the Indian Government in 1956. It was formed to promote the village and khadi industries. As these industries are predominantly run in the rural parts of India, KVIC plays a significant role in developing employment opportunities in these areas.
Khadi refers to the hand-woven fabric made using charkha. Mahatma Gandhi (father of the nation) made it popular in every Indian household through the Swadeshi Movement. Therefore, Khadi has been one of the symbols of India’s freedom struggle.
Administration Structure of KVIC
KVIC is headquartered in New Delhi. The remaining 5 zonal offices are located in these cities:
- Mumbai
- Kolkata
- Bengaluru
- Bhopal
- Guwahati
Apart from the zonal offices, KVIC’s offices are based in 29 other Indian cities. These offices overlook the implementation and execution of the programs as envisioned by the commission. They ensure that the objectives set by the commission are met through these programs.
Popular KVIC Schemes
Here are some popular schemes listed under Khadi Village & Industries Commission:
- KVIC PMEGP
PMEGP (Prime Minister’s Employment Generation Programme) was launched by the government in 2008. It is formed to offer financial assistance to individuals who want to set up micro-enterprises related to traditional industrial sectors like khadi and village industries.
Financial assistance is provided in the form of a subsidy. The subsidy amount varies as per the project cost. You are eligible for a subsidy of up to 35% if you live in urban areas. If you live in the rural areas, you can get a subsidy of up to 50%.
- KVIC ISEC
ISEC in KVIC ISEC stands for Interest Subsidy Eligibility Certificate. This scheme was launched by the government in May 1977 to assist institutions manufacturing khadi and polyvastra in acquiring funds from the banks.
This scheme allows the beneficiary to get a loan at only 4% of interest rate. The difference between the actual interest rate charged by the banking institution and 4% is paid by KVIC. Due to this reason, it is referred to as Interest Subsidy Eligibility Certificate.
- KVIC SFURTI
SFURTI stands for Scheme of Fund For Regeneration of Traditional Industries. It was launched by the MSME Ministry in 2005 to develop clusters of khadi and village industries in rural areas. Around 76 clusters have been created and several of the clusters have been completed by the Khadi Village & Industries Commission.
- KVIC MPDA
MPDA (Market Promotion And Development Assistance Scheme) was launched to provide financial assistance and support to the khadi-producing industries.
KVIC MPDA grants 30% of the total project cost as a subsidy. Out of the total grant, 40% of the benefit goes to the khadi-producing institution and 20% of the benefit is shared with the khadi-selling institution. Artisans are eligible for 30% of the benefit and the remaining 10% of the benefit goes to the volunteers or karyakartas.
- KVIC KRDP
KRDP (Khadi Reform & Development Program) was launched on 22nd December 2009 by the government. Under this scheme, the government and Asian Development Bank signed a loan agreement of $150 million to introduce reforms in khadi and village industries. Its ultimate aim is to make these industries relevant to today’s trends and requirements.
Get more details about each of these Khadi Village & Industries Commission schemes from the below table:
KVIC Loan Features
- The tenure of the KVIC loan can range from 3 to 7 years which comprises a moratorium of 6 months.
- KVIC loans do not come with any income limit. However, the loan is only available for new projects and you should not have taken any other loan for the project in the past.
- The funding pattern of the KVIC loan has been provided in the below table:
| Category of the applicant | Applicant’s contribution to the cost of the project | Rate of subsidy in urban areas | Rate of subsidy in rural areas |
| General | 10% | 15% | 25% |
| ST, SC, Physically Challenged, Ex-servicemen, Women, and other special categories | 5% | 25% | 35% |
- The loan amount of up to Rs.25,00,000 is approved for the industries belonging to the manufacturing sector. For the business and service sector, a loan amount of up to Rs.10,00,000 is approved by KVIC.
Eligibility Criteria For KVIC Loan
KVIC loans follow the PMEGP guidelines. Therefore, to be eligible for the loan, you will have to follow the eligibility criteria set by PMEGP. The sectors that are eligible for the loan are listed below:
- Service and textiles
- Biotechnology
- Rural engineering
- Forest products
- Mineral products
- Food processing i.e. agro-based industries
- Paper and handmade fibers
- Chemical products and polymers
If you are 18+ and are qualified at least till 8th Class, you are eligible for the PMEGP loan. A loan up to Rs.10,00,000 can be availed for the manufacturing unit whereas up to Rs.5,00,000 can be obtained for the service unit.
Charitable trusts, producer co-operative societies, registered societies, and self-help groups (if they have not applied for any other loan) are eligible for the KVIC loan.
How to apply for the KVIC loan Online?
The following steps can be followed to procure the KVIC loan:
- Step 1: You can apply for the KVIC loan using the KVIC online application form. This form is available on the official site of KVIC – http://www.kvic.org.in/
- Step 2: Personal details such as date of birth, educational qualifications, Aadhaar number, etc. are to be filled in the form. Along with that, the form also seeks details such as the location of your production unit, information about the special category, and more.
- Step 3: Once all the details are filled in the application form, you can save it and upload its digitized copy. Along with the form, you must also submit some documents to complete the KVIC online application.
- Step 4: After submitting the form, an application ID and password will be sent to your registered mobile number. These login details will help you to track the application status in the future.
Documents to be Submitted along with the Application Form
Here are the documents that you must submit along with the application form:
- Your KYC documents that establish your identity and address
- Caste certificate to verify your eligibility in any of the special categories.
- A copy of the rent or lease deed of the property which has been rented/leased for the production unit (must not be older than 3 years)
- A project report with a detailed breakup of costs like working capital needs and capital expenditure for at least 1 cycle.
- If you do not need working capital, you must acquire a certificate verifying the same from the bank
- A subsidy claim as per your eligibility should also be submitted along with the KVIC online application
Note: Apart from these documents, other documents may be required as per your eligibility and loan requirements. The details of these documents can be checked on the official website of KVIC.