Bumper opportunity for the youth of UP: Loan up to Rs 5 lakh without interest and guarantee, start your business!

By Samira Vishwas On Dec 14, 2025

Often, due to lack of money, youth are unable to start their own business and there is a fear of paying interest on taking a bank loan. To eliminate all these problems, the Uttar Pradesh government has launched a wonderful scheme named ‘Mukhyamantri Yuva Udyami Vikas Abhiyan’. Under this scheme, any citizen of UP who wants to start his own business can take a loan of up to Rs 5 lakh without interest and without any guarantee.

What is the main objective of the scheme?

The real objective of ‘Mukhyamantri Yuva Udyami Vikas Abhiyan’ is to make the youth of 21 to 40 years self-reliant and encourage them to start their own business. The aim of this scheme is to create more and more entrepreneurs in the state. There is a plan to connect 10 lakh youth with self-employment in the next 10 years, that is, the intention is to provide employment to 1 lakh people every year!

how to apply? The process is very easy

Applying for this scheme is very simple. The main steps are as follows:

First of all, apply online by visiting MSME portal msme.up.gov.in.

Then the District Industry Promotion and Entrepreneurship Development Center will scrutinize your application.

After completion of investigation the form will be sent to the bank.

The bank will check the application and approve the loan and the money will be credited to your account.

Who can take advantage of the scheme? These are the necessary conditions

To avail the benefits of this scheme, some basic conditions have to be fulfilled:

Age should be between 21 to 40 years and it is necessary to have passed at least 8th class.
You should have certificate of skill training from Vishwakarma Shram Samman, ODOP Training, UP Skill Development Mission or any recognized institute.
On making digital payment, you will get an extra grant of maximum ₹ 2000 annually at the rate of ₹ 1 on every transaction.
Loan giving banks: National Banks, Scheduled Banks, Rural Banks and all financial institutions approved by RBI.
Loan will not be available on some businesses, like gutkha, liquor, carry bags, tobacco products etc.

There is no interest on loans up to Rs 5 lakh and no guarantee will be required. It will have to be returned in 4 years. However, while taking the loan, general category will have to deposit 15%, OBC will have to deposit 12.5% and SC/ST/Persons with Disabilities will have to deposit 10%. If you repay the loan in 4 years, you can also take further loan up to Rs 10 lakh. In this, 50% interest subsidy will be available for 3 years on amount up to Rs 7.5 lakh and it will have to be repaid in installments in 3 years.

The most important thing about the plan

A super feature in this scheme of UP government is that the government itself will provide 10% margin money of the total cost of your project. If you run your business successfully for 2 years, this margin money will become a subsidy – meaning you won’t have to pay that money back!