The Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY), the government’s flagship employment-linked incentive scheme, has completed one year of implementation, bringing more than 72 lakh first-time employees into the formal workforce since August 2025. The scheme is implemented by the Ministry of Labour and Employment (MoL&E) through the Employees’ Provident Fund Organisation (EPFO). Running from August 2025 to July 2027 with an outlay of ₹99,446 crore, it offers financial incentives to both new workers and employers who create additional jobs.
What Is PM-VBRY?
PM-VBRY is a Central Sector Scheme that rewards the creation of formal jobs. It was first announced in the Union Budget 2024-25 as the Employment Linked Incentive (ELI) Scheme, one of five schemes in the Prime Minister’s package meant to support employment, skilling and other opportunities for 4.1 crore youth with a combined outlay of ₹2 lakh crore.
The Union Cabinet approved the ELI Scheme on 1 July 2025, and the Prime Minister formally launched it under the name PM-VBRY during the Independence Day address on 15 August 2025. The scheme is designed to run for two years, from 1 August 2025 to 31 July 2027, covering jobs created during this registration window.
The scheme aims to generate employment for more than 3.5 crore people, of whom about 1.92 crore are expected to be first-time entrants into the workforce. It particularly targets labour-intensive manufacturing, where the gap between formal and informal employment has historically been the widest, and complements the National Manufacturing Mission announced in the Union Budget 2025-26.
The Two-Part Incentive Framework
PM-VBRY works through a two-part incentive framework. Part A supports employees who are joining the formal workforce for the first time, while Part B supports employers who expand their workforce. Both parts use EPFO enrolment as the proof of formal employment.
Part A: Incentive for First-Time Employees
Under Part A, any first-time employee who registers with EPFO and earns up to ₹1 lakh per month is eligible for a one-time incentive equal to one month’s EPF wage, capped at ₹15,000. The amount is paid in two instalments.
The first instalment is paid after six months of continuous service. The second is paid after twelve months of service, on completion of a financial literacy programme. A part of the incentive is placed in a designated savings instrument that the employee can withdraw later, a design intended to encourage a habit of saving among young workers.
Part B: Support for Employers
Under Part B, employers registered with EPFO receive up to ₹3,000 per month for two years for every eligible additional employee retained for at least six months. The incentive amount depends on the wage slab of the additional employee.
| Monthly EPF Wage of Additional Employee | Monthly Benefit to Employer |
|---|---|
| Up to ₹10,000 | Up to ₹1,000 (proportional) |
| More than ₹10,000 and up to ₹20,000 | ₹2,000 |
| More than ₹20,000 (up to ₹1 lakh) | ₹3,000 |
To qualify, establishments with fewer than 50 employees must hire at least two additional employees, while larger establishments must hire at least five additional employees. For the manufacturing sector, the incentive period is extended to the third and fourth years, recognising its high potential for employment generation. Payments to employees go through the Direct Benefit Transfer (DBT) mechanism, while employer payments are credited to their PAN-linked accounts.
One Year of Implementation: The Numbers
The scheme completed its first year on 1 August 2026, and the figures released by the government underline the scale of its impact.
- More than 72 lakh first-time employees have joined the formal workforce through EPFO registration since August 2025.
- Nearly 30% of the beneficiaries are women, reflecting growing female participation in formal employment.
- More than 15 lakh beneficiaries have already received employment-linked incentives under the scheme.
- In June 2026, the Prime Minister disbursed incentives worth about ₹2,400 crore to beneficiaries through the DBT mode at a special event in New Delhi.
The first-year figure of over 72 lakh is significant when set against the scheme’s two-year target of 1.92 crore first-time employees. It also adds to the broader trend of workforce formalisation, with EPFO’s provisional payroll data showing that more than 1.29 crore net subscribers were added during 2024-25, up from about 61.12 lakh in 2018-19.
Why Formal Employment Matters
A large share of India’s workforce has historically worked in the informal or unorganised sector, where jobs carry no provident fund, pension, insurance or other social security cover. When a worker enters the formal workforce through EPFO, they gain access to retirement savings through the Employees’ Provident Fund (EPF) Scheme, a pension through the Employees’ Pension Scheme (EPS) and life cover through the Employees’ Deposit Linked Insurance (EDLI) Scheme.
Formalisation also matters for the wider economy. Formal jobs create a paper trail of wages and contributions, which widens the tax base, improves data on employment and helps the government design better policies. For the worker, formal status means financial security in old age and access to credit, since banks treat regular provident fund contributions as proof of stable income.
EPFO: The Institutional Backbone
The scheme is administered by the Employees’ Provident Fund Organisation (EPFO), a statutory body established under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952. EPFO functions under the administrative control of the Ministry of Labour and Employment and is headquartered in New Delhi. It is one of the world’s largest social security organisations, and its decision-making body, the Central Board of Trustees (CBT), is chaired by the Union Labour Minister.
EPFO already runs several employment and social security schemes, which is why it was chosen to deliver PM-VBRY. Its existing infrastructure, including Universal Account Numbers (UAN) and monthly Electronic Challan-cum-Return (ECR) filings by employers, allows the government to verify that a job is genuine and that incentives are not misused.
How the Scheme Is Delivered Digitally
PM-VBRY is a fully digital scheme built on the EPFO platform. Beneficiaries do not need to apply separately, since eligibility is verified automatically through EPFO records and employer filings.
A worker’s UAN must be authenticated through Face Authentication Technology (FAT) on the UMANG app before any incentive is released. Employers must file monthly ECRs showing contributions paid for the new employee. Once these checks are satisfied, the incentive is transferred directly to the worker’s Aadhaar-linked bank account through DBT, while employers receive payments in their PAN-linked accounts.
A dedicated PM-VBRY portal provides end-to-end management of the scheme and allows real-time monitoring of beneficiaries and sector-wise progress. The government has also deployed Cross-Functional Teams made up of officials from EPFO, the Employees’ State Insurance Corporation (ESIC) and the Chief Labour Commissioner (CLC) to spread awareness and increase participation at the grassroots level.
Challenges and the Way Forward
PM-VBRY builds on an earlier experiment, the Pradhan Mantri Rojgar Protsahan Yojana (PMRPY), launched in 2016-17, under which the government paid the employer’s provident fund contribution for new employees. That scheme covered only the employer side and was criticised for unclear evidence on whether it created genuinely new jobs or merely formalised existing ones. PM-VBRY tries to address this weakness by rewarding only net additional hiring and by requiring sustained employment of at least six months.
One recurring question about employment-linked schemes is whether they create new jobs or simply shift informal workers into formal records, a concern referred to as additionality. The government counters that formalisation itself has value, since it extends social security and strengthens the data base for policy. With India adding roughly 70-80 lakh new labour force entrants every year, the scheme’s success depends on continued employer participation and on ensuring that incentives reach workers without delay.
The remaining period of the scheme, until July 2027, will show whether the early momentum can be sustained. The government sees PM-VBRY as a central plank of its approach to converting India’s demographic dividend into productive employment, alongside skilling initiatives and the push to raise manufacturing’s share of the economy. For now, the one-year milestone of over 72 lakh formal entrants provides a strong base for the scheme’s second year.
Key Takeaways
- The Pradhan Mantri Viksit Bharat Rojgar Yojana (PM-VBRY) completed one year of implementation on 1 August 2026, bringing over 72 lakh first-time employees into the formal workforce.
- The scheme is implemented by the Ministry of Labour and Employment through the Employees’ Provident Fund Organisation (EPFO), a statutory body under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, headquartered in New Delhi.
- PM-VBRY runs from 1 August 2025 to 31 July 2027 with a total outlay of ₹99,446 crore, aiming to generate employment for over 3.5 crore people, including 1.92 crore first-time employees.
- Under Part A, first-time employees earning up to ₹1 lakh per month get a one-time incentive capped at ₹15,000, paid in two instalments after six and twelve months of service.
- Under Part B, employers receive up to ₹3,000 per month for two years for each additional employee, with the incentive extended to four years for the manufacturing sector.
- Nearly 30% of PM-VBRY beneficiaries are women, and more than 15 lakh beneficiaries have already received incentives through the Direct Benefit Transfer (DBT) mechanism.
