Mudra Loan

What is MUDRA Loan?

Micro Units Development and Refinance Agency (which is MUDRA full form) Loan scheme under Pradhan Mantri Mudra Yojana (PMMY) is an initiative by Government of India that offers loans to individuals, SMEs and MSMEs. MUDRA loan is offered under 3 loan schemes named as Shishu, Kishor, and Tarun. The maximum loan amount offered under MUDRA scheme is up to Rs. 10 lakh, whereas there is no minimum loan amount criteria. No collateral or security is required by banks or financial institutions to avail Mudra loan. The repayment tenure of Mudra loan ranges from 3 years to 5 years with flexible EMI options.

Features of Mudra Loan

Mudra scheme can be availed by individuals, SMEs, MSMEs, enterprises or businesses engaged in Manufacturing, Trading and Services Sectors, only.

Benefits of Mudra Loan

• Mudra loans are majorly offered to shopkeepers, traders, vendors, and MSMEs engaged in manufacturing, trading and service sector activities
• Mudra scheme is are covered under Credit Guarantee Schemes from Govt. of India
• Availed loan amount can also be used as term loans and overdraft facilities
• All Non-farm enterprises, i.e. small or micro firms engaged in the income generating activities can avail Mudra loan
• Mudra scheme can be availed via Mudra cards, as well

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Mudra Loan Details

Products offered under Mudra Loan

Products offered under Mudra Scheme are classified under 3 loan schemes named as Shishu, Kishor and Tarun. Below mentioned is the loan amount offered under each loan scheme:

• SHISHU Loan: Loans up to Rs. 50,000 (For start-ups and new businesses)
• KISHOR Loan: Loans from Rs. 50,001 to Rs. 5,00,000 (For buying equipment/machinery, raw materials, business expansion for existing enterprises)
• TARUN Loan: Loans from Rs. 500,001 to Rs. 10,00,000 (For established businesses and enterprises)

Also Read: Mudra Loan Application Form Important Fields & Sections

Purpose of Pradhan Mantri Mudra Yojana

Mudra scheme can be availed to perform various income generating activities as mentioned below:

• Commercial Vehicle: Purchase of commercial transport vehicles like tractors, auto-rickshaws, taxis, trollies, tillers, goods transports vehicles, 3-wheelers, e-rickshaws, etc.
• Service Sector Activities: Starting businesses of salons, gyms, tailoring shops, medicine shops, repair shops, and dry cleaning and photocopying shops, etc.
• Food and Textile Product Sector Activities: Various activities involved in respective sector
• 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 centres, food & agro-processing units, poultry, pisciculture, bee keeping, sorting, livestock-rearing, grading, aggregation agro industries, diary, fishery, etc.

Also Read: How to Get Collateral Free Business Loans?

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Mudra Loan Bank List

Financial institutions that offer PM MUDRA Loan, directed by RBI are as follows:

Mudra Loan Documents required

• Self-written business Plan
• Duly filled application form for specific category, Shishu form to be separate as compared to Kishor and Tarun loan category
• 2 recent Passport-sized photographs of the applicant and co-applicant, if applicable
• KYC documents of Applicant and Co-applicants
• Proof of Identity (Aadhar card / Voter’s ID card / Passport / Driving License, etc.)
• Proof of Residence (Aadhar Card / Voter’s ID card / Passport / Telephone Bill / Bank Statement, etc.)
• Income Proof with financials, such as ITR, Sales Tax return, Licenses, Registrations, etc, if any
• Proof of belonging to a special category, such as SC, ST, OBC, Minority, etc. (if applicable)
• Business address and tenure proof, if applicable
• Registrations, Licenses or Certificates, if any

Also Know:  What is the interest rate under Mudra loan?

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What is Mudra Loan for Women?

Mudra Yojana under PMMY encourages women entrepreneurship and for that Govt. of India has asked various financial institutions, including Micro Finance Institutions (MFIs) to consider extending facilities, such as reducing interest rates on their loan for women borrowers. Currently, Mudra extends a reduction of 25 Basis Points (BPS) in the interest rates offered from NBFCs and MFIs to women entrepreneurs.

MUDRA Card

Mudra card is a debit card that is issued to the loan applicants who wish to apply for Mudra loan. When a loan applicant applies for this loan and if it gets approved, the bank or the  lender opens a Mudra loan account and issues the card along with it. The amount is disbursed into the Mudra account so the applicant can debit the amount from their Mudra Bank. This process also helps in keeping a credit history for the borrower who has applied for this scheme.

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Pradhan Mantri Mudra Loan Helpline Complain Number

Also, Check State Toll-Free Numbers for Pradhan Mantri Mudra Loan Yojana, Click here

FAQs on Mudra Loan

Q. What is the maximum amount of loan you can avail under the PMMY scheme?

Ans. The maximum loan amount that can be availed under PMMY is up to Rs. 10 lakh.

Q. What is the maximum loan amount offered under Mudra Shishu Loan?

Ans. The maximum loan offered under Mudra Shishu Loan is up to Rs. 50,000.

Q. What is the repayment tenure of the Mudra scheme?

Ans. The repayment tenure of Mudra scheme is maximum up to 5 years.

Q. How much time does it take for Mudra Finance to get approved?

Ans. Generally, it takes around 7-10 working days for a loan approval by banks in case of Mudra Yojana under PMMY.

Q. Is security/collateral required for Pradhan Mantri Mudra Loan?

Ans. No, Collateral or security is not required by banks under Mudra Finance.

Q. Is ITR compulsory for Mudra Finance?

Ans. For existing businesses and salaried people, last years’ ITR is necessary to be presented to apply for business loans under Mudra Yojana.

Q. How can I check my Mudra loan status?

Ans. You can check your mudra loan status online by visiting the respective bank’s website and checking via its e-mudra loan application status section.

Q. How to Apply for Mudra Loans?

Ans. The application form is available at mudra.org.in, so you can download the form and fill in all the required details. Different banks may have slightly different application procedures. You must visit the nearest branch of the desired bank from where you want to get the Mudra loan and submit the filled downloaded form and complete the bank formalities.

Also Know: Details on SBI Mudra Loan & How to Apply for SBI e Mudra Loan

Q. Which banks offer PM Mudra Loan?

Ans. Private and public sector banks, Small Finance Banks (SFBs), Micro Finance Institutions (MFIs), Non-Banking Financial Companies (NBFCs), Regional Rural Banks (RRBs) and Commercial banks in both private and public sectors offers Pradhan Mantri Mudra Loan, as per sole permission and directions from the RBI.

Also Read: How to get a business loan in India

Q. Can people from metropolitan cities apply for Mudra Loan Scheme?

Ans. Absolutely! All sole proprietors and the owners of Micro, Small and Medium Enterprises (MSMEs) engaged in non-agricultural services and activities across the country, including metro, urban, semi-urban and rural areas can apply for a Mudra loan.

Q. Can I get a Mudra business loan under Mudra Yojana for a restaurant startup?

Ans. Yes, you can apply for Mudra loan to start a new business, if your loan requirement is not more than Rs. 10 lakh. The interest rate shall depend on the applicant’s profile, business requirements, repayment tenure, etc.

Q. Is there any special Mudra loan scheme for women?

Ans. Yes there is. United Mahila Udhyami Yojana is a part of the Mudra loan scheme. Under this, women engaged in production, manufacturing or service-related economic activities can apply for a loan. This scheme is specially formulated to empower women entrepreneurs and encourage them further. Women with more than 50% financial holdings in a company can also apply for a Mudra loan under this category.

Q. How has the Pradhan Mantri loan scheme for ladies benefitted the women of India?

Ans. Mudra Yojana has helped millions of customers to start their own business at affordable interest rates and promoted the MSME sector by creating employment opportunities.

Q. How do financial institutions support Pradhan Mantri Mudra Yojana for ladies implementation?

Ans. Mudra loans are offered with the help of several financial institutions like private and public sector banks, Regional Rural Banks, Micro Finance Institutions, etc. as per the directions of RBI.

Q. What are the key features of the Pradhan Mantri Loan Yojana for ladies?

Ans. The key features of Mudra Yojana include the following:

• Mudra Yojana is categorised into 3 loan schemes, named as Shishu, Kishor and Tarun
• No minimum loan amount criteria
• Maximum loan amount up to Rs. 10 lakh
• Collateral Free Loan
• Repayment Tenure is up to 5 years

Q. Can I get Mudra loan for new business? 

Ans. Definitely! Banks offers Mudra loans to start-ups in the manufacturing, trading and other non-agricultural sectors. To get Mudra loans for your start up, you need to present your business plan along with the duly filled application form. Thousands of budding entrepreneurs have already availed Mudra loans to realise their dreams.

Q. We own a bakery business and want to expand it. Can we get Mudra Loans?

Ans. Yes, you can avail assistance under the “Shishu” or “Kishor” category of Micro Credit Scheme of MUDRA to expand your business. Contact your nearest Micro Finance Institution (MFI) to know the application procedure.

Q. What is a Mudra Card?

Ans. The Mudra Card, is a card that offers cash credit services and can also be used overdraft by small business owners. It can also act as a debit card that owners can swipe at Points of Sale (PoS) with merchants or use to withdraw cash from an ATM. The Mudra card works on the RuPay platform, as well.

Q. What is the recent initiative by Government of India for Mudra scheme?

Ans.As per ‘Atmanirbhar Bharat Abhiyan’ or ‘Self-reliant India Scheme’, Government of India introduced various benefits under MUDRA Shishu Category

• Relief of Rs. 1500 crore to MUDRA Shishu loan borrowers
• Rs. 1500 crore Interest subsidy for MUDRA Shishu Loan category
• Government of India shall provide Interest discount of 2% for fast recipients for a period of 12 months

Q. I want to expand my pottery business by adding more variety and designs. What help can I get from Mudra?

Ans. You can apply for Mudra loan under three loan schemes named as Shishu, Kishor and Tarun, wherein there is no minimum limit to borrow and maximum loan amount is up to Rs. 10 lakh.

Q. I intend to work on franchisee model and open an ice cream parlour. Can mudra help me?

Ans. Of course, you can apply for business loan under Mudra loan at attractive interest rates with no processing fee and no collateral to be submitted.

Q. What does the Mudra Yojana scheme for women comprise?

Ans. Mudra loan for women offered is exactly the same as for other individuals.

Q. I have graduated recently. I want to start my own business. Can MUDRA help me?

Ans. If your age is above 18 years then you can apply for the Shishu category under Mudra loan wherein there is no minimum loan limit and maximum loan amount is up to Rs. 50,000.

Q. I have a diploma in food processing technology. I want to start my own unit. Please guide me.

Ans. If your loan amount limit is not above Rs. 10 lakh, then you can apply for business loan under Mudra loan at attractive interest rates. The criteria shall be defined by the respective bank.

Q. I have done a course on fashion designing. I want to open my own boutique and develop my own brand. What help can MUDRA offer to me?

Ans. Mudra Yojana offers loans up to Rs. 10 lakh at affordable interest rates. You can visit the nearest bank that offers Mudra loan with all the required documents to apply for business loan. You can also visit the official website to download the application form.