MUDRA scheme

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MUDRA scheme

MUDRA scheme – To help MSMEs grow
Purpose : MUDRA, which stands for Micro Units Development & Refinance Agency Ltd., is a financial institution set up by Government of India for development and refinancing of micro units enterprises.
Pradhan Mantri Mudra Yojana (PMMY) is a scheme set up by the Government of India (GoI) through MUDRA (a subsidiary of SIDBI), focusing on extending financial support to the small business sector and has a variety of sub-schemes designed for specific business needs.
Helps in facilitating micro credit up to Rs. 10 lakh to small business owners. MUDRA supports Financial Intermediaries to extend loans to the non-corporate, non-farm sector income generating activities of micro and small entities with credit needs up to Rs. 10 lakhs).

Features

The interventions have been named 'SHISHU', 'KISHOR' and 'TARUN' to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur.

SHISHU ( Covering loans upto INR 50,000 )

  • This stage caters to entrepreneurs who are either in their primitive/early stage or require lesser funds in order to get their businesses started.
  • The interest rates range from 1% to 12%

KISHOR ( Covering loans up to INR 5,00,000 )

  • This section of entrepreneurs would belong to either those who have already started their business and want additional funds to mobilize and sustain their business
  • This loan is also for small entrepreneurs who require larger sum of money than what is covered under SHISHU
  • The interest rates range from 8% to 12%

TARUN ( Covering loans up to INR 10,00,000)

  • If an entrepreneur meets the required eligibility conditions, he/she could apply loan for upto Rs.10 lakhs. This would be the highest level of amount that an entrepreneur could apply for a startup loan in order to finance expansion, bigger changes in the business
  • The interest rates range from 11% to 20%

Eligibility

  • The borrowers should be an Indian citizen.
  • The loan requirement should not range more than Rs. 10 lakhs.
  • The enterprises generating income from farming activities, cannot apply for MUDRA loan.
  • Small enterprises in rural, as well as urban areas, can apply for Pradhan Mantri Mudra Loan

Eligibility criterion

The business should be either one of the following :

  • Small manufacturing enterprise
  • Shopkeepers
  • Fruit and Vegetable vendors
  • Artisans
  • 'Activities allied to agriculture', e.g. pisciculture, bee keeping, poultry, livestock, rearing, grading, sorting, aggregation agro industries, diary, fishery, agriclinics and agribusiness centres, food & agro-processing, etc. (excluding crop loans, land improvement such as canal, irrigation and wells).

Application process

  • The borrowers can also apply for Mudra Loan online on “Udyamimitra” Portal (www.udyamimitra.in) by registering yourself and their application shall be viewed by many lenders for credit support.
  • The loans under MUDRA scheme can be availed only through banks and lending institutions which include :
    • Public Sector Banks
    • Private Sector Banks
    • State operated cooperative banks
    • Rural banks from regional sector
    • Institutions offering micro finance
    • Financial companies other than banks

Last Updated On : Wednesday, 11-11-2020

Interest Rates

8.50%* p.a. onwards

w.e.f. 05.04.2024

*T&C Apply.

 

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