UP CM Yuva Yojana 2026 Offers Up To ₹10 Lakh Loan To Help Youth Start Businesses

The Uttar Pradesh government has intensified its focus on youth entrepreneurship through the Mukhyamantri Yuva Udyami Vikas Abhiyan , widely known as the UP CM Yuva Yojana . The initiative is designed to encourage young residents to become job creators rather than job seekers. With updated targets announced for 2026, officials have been directed to achieve full implementation goals by 15 March, 2026. The broader vision is ambitious, aiming to develop 100,000 young entrepreneurs every year and facilitate the establishment of nearly one million small business units over the next decade.

Scheme Designed For Skilled Youth Without Capital

The programme specifically targets young individuals who possess skills or technical training but lack financial resources to launch their ventures. By bridging the funding gap, the government hopes to stimulate grassroots economic activity and strengthen local industries.

The scheme operates in two structured phases, ensuring that financial assistance is linked with business performance and repayment discipline.

Phase One Focuses On Entry-Level Businesses

Under the first phase, business projects with costs of up to ₹5 lakh are approved. Eligible applicants can secure bank loans of up to ₹4.5 lakh. One of the most attractive features is that the loan is interest-free and collateral-free, making it accessible to first-time entrepreneurs.

A six-month moratorium period is provided before repayment begins. After this grace period, beneficiaries repay the loan over four years. This flexible structure allows businesses time to stabilise before financial obligations begin.

Expansion Support Under Phase Two

Entrepreneurs who successfully repay the first-phase loan on time become eligible for the second phase. Here, the project size can expand up to ₹10 lakh, enabling business scaling and diversification.

This stage offers a 50 percent interest subsidy, significantly lowering financial burden. In addition, the government covers the credit guarantee fee under CGTMSE, improving credit access and reducing risk for lenders. The second phase is designed to transform micro-enterprises into sustainable small businesses.

Eligibility Criteria For Applicants

To apply under the UP CM Yuva Yojana, candidates must be permanent residents of Uttar Pradesh. The age bracket is set between 21 and 40 years, with relaxations available for certain reserved categories.

Applicants must have passed at least Class 8. More importantly, they should have undergone skill training through recognised government programmes or hold a diploma or degree relevant to their trade.

Another key condition is that the applicant should not be availing benefits from any other government self-employment scheme simultaneously.

Online Application And Documentation Process

The application process has been fully digitised to ensure transparency and accessibility. Interested candidates can apply through the MSME portal or the scheme’s dedicated website.

Essential documents include Aadhaar card, PAN card, residence proof, bank passbook, educational certificates, and a detailed project report outlining the proposed business plan.

After registration, applicants complete OTP verification linked to Aadhaar and mobile numbers before submitting personal and enterprise details. In 2026, digital tracking through dashboards and mobile applications has been introduced, allowing real-time monitoring of application progress.

Margin Money Contribution Structure

Financial participation from beneficiaries is built into the scheme through a margin money model. Applicants contribute a portion of the project cost depending on their social category.

General category applicants contribute 15 percent, OBC candidates 12.5 percent, while SC, ST, and differently-abled applicants contribute 10 percent.

To further ease the burden, the government provides a margin money subsidy of 10 percent, capped at ₹50,000. This reduces initial investment pressure and makes entrepreneurship more attainable.

Driving Employment Through Enterprise Creation

The Mukhyamantri Yuva Udyami Vikas Abhiyan represents a strategic shift towards employment generation through enterprise development. By combining training, credit support, and subsidies, the scheme aims to create a robust ecosystem for youth-led businesses.

As implementation accelerates in 2026, the initiative is expected to play a significant role in boosting local manufacturing, services, and self-employment opportunities across Uttar Pradesh.