The Pradhan Mantri MUDRA Yojana PMMY Scheme launched by the Prime Minister provides loans of up to Rs10 lakh to non-corporate, non-farm small/micro-enterprises.MUDRA Loans are designed to meet the needs of various sectors/business activities as well as business/entrepreneur segments within the framework and overall goal of development and growth of the micro-enterprise sector.
What is PMMY Scheme?
The Micro Units Development and Refinance Agency (MUDRA) Loan Scheme under PMMY Scheme, or Pradhan Mantri Mudra Yojana, is a government initiative that provides loans to individuals and MSMEs through banks and NBFCs. MUDRA Yojana is available in three loan schemes i.e Shishu, Kishor, and Tarun. Loans under the PMMY Scheme are collateral/security-free loans made available by financial institutions with repayment terms ranging from 12 months to 5 years and flexible EMIs.
Highlights of Pradhan Mantri Mudra Yojana
|Name of the Scheme||Pradhan Mantri MUDRA Yojana (PMMY)|
|Launched by||Prime Minister|
|Interest Rate||Differs from bank to bank & depends on business requirements|
|Types of Mudra Scheme||Three (Shishu, Kishor, and Tarun)|
|Minimum Loan Amount||No minimum limit|
|Maximum Loan Amount||Up to Rs. 10 lakh|
|Collateral/Security||Not required by banks/NBFCs|
|Repayment Tenure||From 12 months to 5 years|
Who is Eligible to Apply for PMMY Scheme?
MSMEs, Individuals, enterprises, or businesses engaged in trading, manufacturing, or providing services are the only ones who can benefit from the Mudra scheme.
Loan Schemes Offered Under PMMY Scheme
Loans made available through the Pradhan Mantri Loan Yojana (PMMY) are classified into three schemes:
- Kishor and
The loan amount offered under each loan scheme is listed below:
- SHISHU Loan: The Mudra Shishu Loan scheme provides loans of up to Rs. 50,000 (for start-ups and new businesses).
- KISHOR Loan: Loans ranging from Rs. 50,001 to Rs. 5, 00,000 are available under the Kishor Loan Scheme (for the purchase of equipment, machinery, raw materials, and business expansion for existing businesses).
- TARUN Loan: The Tarun Loan Scheme provides loans ranging from Rs. 500,001 to Rs. 10, 00,000 (for established businesses and enterprises).
Documents Required for PMMY Mudra Loan
Following are the documents required for the PMMY Mudra loan application form:
- Completed application with passport-sized photos.
- Applicant and co-applicants’ KYC documents: voter identification card, Passport, PAN card, Aadhar card, driving license, utility bills (water/electricity bills)
- Proof of membership in a special category, such as ST,SC, OBC, Minority, and so on (if applicable).
Benefits of PMMY Scheme
Following are the benefits of the PMMY Scheme.
- Mudra Loans are primarily available to individuals, shopkeepers,retailers, traders, vendors, and MSMEs in the trading, manufacturing, and service sectors.
- Mudra loans are available to all non-farm enterprises, i.e. small or micro firms engaged in income-generating activities.
- Only the Mudra scheme is covered by the Government of India’s Credit Guarantee Schemes.
- Borrowed funds can also be used for term loans, working capital loans, and overdrafts.
- Mudra cards are a type of debit card that is given to borrowers and can be used to withdraw loan funds as needed by the business.The loan amount can be withdrawn in installments from the total sanctioned amount using the Mudra card.
- People from the SC/ST categories can also apply for Mudra loans at reduced interest rates.
Businesses Covered Under PMMY Scheme
The following are a list of businesses that are covered by the Mudra scheme to perform income-generating activities:
|Commercial Vehicle||Mudra finance for machinery and equipment can be used to purchase commercial transport vehicles like TractorsAuto-rickshaws Taxis trolliesTillers Goods transports vehicles3-wheelers E-rickshaws, etc.|
|Service Sector Activities||Starting businesses of Salons, Gyms, Tailoring shops, Medical shops, Repair shops, and Dry cleaning and photocopying shops, etc.|
|Food and Textile Product Sector Activities||Various activities involved in the respective sector, such as papadAchaarIce cream BiscuitsJamJelly and sweets making, as well as for agriculture produce preservation at rural level|
|Business activities for Traders and Shopkeepers||Setting up shops Service enterprises Trading and business activities and Non-farm income-generating activities|
|Equipment Finance Scheme for Micro Units:||Maximum loan up to Rs. 10 lakh|
|Agri-allied Activities||Activities related to businesses in agri-clinics and agribusiness centers Food & agro-processing units Poultry farming Pisciculture Beekeeping Sorting Livestock-rearing Grading Aggregation agro-industries Dairy fishery etc.|
Bank List for Mudra Loan
The following financial institutions are authorized by the RBI to provide MUDRA loans:
|Axis Bank||Indian Bank|
|Bajaj Finserv||Karnataka Bank|
|Bank of India||Lendingkart Finance|
|Bank of Baroda||Kotak Mahindra Bank|
|Central Bank of India||State Bank of India|
|Canara Bank||Saraswat Bank|
|IDFC First Bank||Union Bank of India|
|HDFC Bank||Syndicate Bank|
|ICICI Bank||ICCI Bank Tata capital|
|Bank of Maharashtra||Punjab National Bank|
|IDBI Bank||YES Bank|
Pradhan Mantri Mudra Yojana Application Form
The application form is available at mudra.org.in, where you can download it and fill in all of the required information. Different banks’ application processes may differ slightly. You must go to the nearest branch of the bank where you want to get the Mudra loan and submit the duly completed application form, as well as complete the bank formalities.
For the Shishu category, the MUDRA loan application form is separate, whereas the loan form for the Kishor and Tarun categories is the same.
To complete the Mudra loan application form, applicants must provide the following information as requested on the loan form:
- Applicant’s name, address, date of birth, educational qualifications
- Constitution of Business: Individual, Joint, Proprietary, Partnership or Any other
- Father’s/Husband’s name
- Business address
- KYC documents of applicant, co-applicants and partners
- Line of business activity
- Annual Sales
- Social Category: Religion
- Details of Skill Certificate, if any
- Details of existing account: A/C number and bank branch
- Category: General, SC/ST/OBC, any other
Mudra Loan for Women Entrepreneur
Mudra Yojana under PMMY encourages women entrepreneurship, and banks and Micro Finance Institutions (MFIs) provide credit facilities for women borrowers, such as lower or concessional interest rates on loans. PMMY Scheme currently offers a 25 basis point (BPS) discount on interest rates offered by NBFCs and MFIs to female entrepreneurs. The maximum loan amount available under the Mudra Yojana for female entrepreneurs is Rs. 10 lakh. Women’s Mudra loan eligibility remains the same as it is for individuals and businesses.
At the G20 Labour and Employment Ministers’ Meeting, Labour Minister Santosh Kumar Gangwar announced that more than Rs 9 lakh crore in collateral-free loans has already been disbursed under the Mudra scheme. According to the labor minister, approximately 70% of Pradhan Mantri Mudra Yojana account holders are women (PMMY). Mudra Yojana was created primarily to provide financial assistance to aspiring entrepreneurs.
What is Exactly MUDRA Card?
Mudra card is a type of debit card issued to Mudra loan borrowers. This helps them to meet their working capital needs. Following the approval of a Mudra loan, the lender opens a Mudra loan account for the borrower and issues a debit card. Borrowers can withdraw funds from the total sanctioned amount in installments based on their business needs after the loan is disbursed in their bank account.
Some Achievements under PMMY FY 2020-2021
Following are the achievements under PMMY Scheme:
|No. Of PMMY Loans Sanctioned||7669969*|
|Amount Sanctioned||Rs. 44125.74 crores|
|Amount Disbursed||Rs. 38668.03 crores|
In case you have any query regarding the PMMY MUDRA scheme, feel free to contact on the below-mentioned toll- free numbers:
You can check the status of your mudra loan online by going to the respective bank’s website and going to the e-mudra loan application status section.
For existing businesses and salaried individuals, the previous year’s ITR must be presented in order to apply for business loans under the Mudra Yojana.
In the case of Mudra Yojana under PMMY, banks typically approve loans in 7-10 working days.
No, banks or other financial institutions are not required to provide collateral or security under Mudra Finance.
Following banks provide the PM Mudra Loan:
Small Finance Banks (SFBs)
Private and public sector banks
Non-Banking Financial Companies (NBFCs)
Micro Finance Institutions (MFIs)
Regional Rural Banks (RRBs) and
Commercial banks in both the private and public sectors provide Pradhan Mantri Mudra Loans under the RBI’s sole permission and direction.
Mudra loans are available to sole proprietors and owners of Micro, Small, and Medium Enterprises (MSMEs) engaged in non-agricultural services and activities throughout the country, including urban, metro, semi-urban, and rural areas. So residents of major cities can definitely apply for the Mudra Loan Scheme.
Yes, the United Mahila Udhyami Yojana is a Mudra loan scheme designed specifically for women entrepreneurs. Women who work in production, manufacturing, or service-related economic activities are eligible to apply for a loan under this program. This program is designed specifically to empower and encourage female entrepreneurs. Women who own more than half of a company can also apply for a Mudra loan under this category.
The following are the key features of a Mudra loan for female entrepreneurs:
Mudra Yojana is divided into three loan schemes: Shishu, Kishor, and Tarun.
Interest rates at a discount
Collateral/Security-Free Loans with a maximum loan amount of Rs. 10 lakh
Repayment Tenure ranges from 12 months to 5 years, with no processing fees and no foreclosure charges.
Can I get a Mudra business loan through the Mudra Yojana to start a restaurant?
Yes, if your loan requirement is less than Rs. 10 lakh, you can apply for a Mudra loan to start a new business. The interest rate will differ from bank to bank and will be determined by the applicant’s business requirements, profile, repayment tenure, and other factors.
Mudra loans are provided by banks to start-ups in the manufacturing, trading, service, and other non-agricultural sectors. Mudra loans are available to startups at competitive interest rates with flexible repayment options. Many aspiring entrepreneurs have already used Mudra loans to start their own businesses.
Of course, you can apply for a business loan through Mudra at a low interest rate with no processing fee and no collateral required.
Yes, you can get help expanding your business through the MUDRA Micro Credit Scheme’s “Shishu” or “Kishor” categories. To learn more about the application process, contact your nearest bank or Micro Finance Institution (MFI).
You can apply for a Mudra loan under one of three loan schemes, Shishu, Kishor, or Tarun, at low-interest rates, with a maximum loan amount of Rs. 10 lakh and no processing fee.
If you are over the age of 18, you can apply for the Shishu category of Mudra loans, which allows you to borrow up to Rs. 50,000.
Mudra Yojana provides loans to help you start your own boutique. You can apply for a business loan by going to your nearest bank that offers Mudra loans and bringing all of the necessary documents. You can also download the application form from the official website.