Farm mechanisation has contributed significantly to the development of agricultural economy of Punjab but farmers with meagre resources at their command can’t go further due to high price of machines. Providing the farm machinery services on rental as well as on custom hiring to the farmers is the most practical solution. Various models have been developed in order to select the optimum machinery and resources allocation to minimize cost and timeliness of agricultural operations. Availability of these machines at farmer’s doorstep has been promoted under Central Sector scheme. The use of these machines is knowledge centric; therefore, hands-on training is very important. Sub-mission on agricultural mechanization is promoting custom hiring centres to offset adverse economies of scale arising due to small landholding and high cost of individual ownership. Paddy residue has emerged as a major challenge to the contemporary agriculture in Punjab as farmers generally resort to burning of this paddy straw in the field itself due to lack of time. Therefore, an attempt was made to establish machine bank for capacity development of rural youth in machine operation & maintenance and develop them as entrepreneur. Various machines were provided to the farmers for demonstrating the crop residue management technology at strategic locations. It was found that the model of Machine bank established is proving efficient model in attracting rural youth for entrepreneurship development in mechanisation. The concept of Innovation Hub proved an excellent way to diffuse in-situ technology packages at grass root level.