Canara Bank is one of the largest public sector banks that provides financial and banking products and solutions to its customers. Besides providing credit or funding solutions, it provides Mudra loans to Micro, Small and Medium Enterprises (MSMEs). These enterprises must be non-agricultural and non-corporate businesses that are engaged in the service, trade, or manufacturing sectors.
Click here to download Application form for Mudra Loan offered by Canara Bank
Canara Bank Mudra Loan – Features & Interest Rate – 2021
|Maximum Loan Amount||Rs. 10.00 Lakh|
|Collateral or Security||Not Required|
|Processing Fee||Up to Rs. 5 Lakh – Nil|
|Above Rs. 5 Lakh – Rs. 500 onwards|
|Interest Rate||Based on applicant’s profile and business requirements|
|Tenure||Up to 5 years|
Note: The mentioned interest rates, fees and charges are subject to change and depend on the sole discretion of the bank and RBI. GST and service tax shall be levied extra on the mentioned charges.
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Canara Bank – CGTMSE scheme
|Purpose||Funding support to SMEs without Collateral or Security|
|Eligibility||Existing and New SMEs are eligible to avail loans up to Rs. 2 crore without any security|
|Max. amount coverage||Up to Rs. 2 crore (Both fund based and non-fund based activities)|
|Waiver||Waiver of CGTMSE Cover for loan limits above Rs.10 Lakh up to Rs. 2 crore by accepting securities of 75% of the loan limit|
|Annual Guarantee Fee (AGF)||1.00%, 1.35%, 1.50, 1.80, 2.00% depending upon category of the borrower, region, quantum of finance etc. is to be borne by the borrower|
|Bank’s incentives under CGTMSE||Bank offers 0.25% rebate on interest for loans covered under CGTMSE scheme up to Rs. 2 crore. (Exclusions advised under various schemes)|
Canara Bank Mudra Loan – Eligibility
To avail Canara Bank Mudra Loan applicant must meet the following eligibility criteria:
- Applicant must have a good relationship with the bank for the previous 2 years
- Applicant’s business must be running profitably for the last 2 years
- Applicants who have accounts with other banks can also apply, as long as they meet Other Party Liability criteria set by Canara Bank
- Individuals, proprietors, partners and Self Help Groups can apply
- Private limited company, Hindu Undivided Family (HUF) and Trusts are not eligible
- Businesses judged at high risk are also not eligible
Types of Mudra Loan in Canara Bank
Canara Bank offers three types of Mudra loan which are divided on the basis of loan amount offered. The scheme name and amount offered is given below:
|Mudra Loan Scheme||Amount|
|Shishu||Up to Rs. 50,000|
|Kishore||Between Rs. 50,000 & Rs. 5.00 Lakh|
|Tarun||Between Rs. 5.00 Lakh & 10.00 Lakh|
Shishu scheme of Canara Bank Mudra Loan is for those applicants who want to avail loans up to Rs. 50,000. This amount is beneficial to customers who want to start a new business.
Kishore scheme can be availed by those customers who need a loan amount over Rs. 50,000 but less than Rs. 5 lakh. It’s perfect for those businesses that have already been established but want to expand. The money can be used to hire staff, purchase equipment and so on.
Tarun scheme allows customers to apply for the maximum loan amount offered under Mudra Loan which is Rs. 10 lakh. This allows the customer to expand their business quickly by meeting all the demands of a growing business.
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Documents Required for Loan Application
The following documents are required to apply for any Canara Bank Mudra Loan scheme:
- Identity Proof – Driver license, PAN Card, Aadhar card, passport and the like
- Residence Proof – Electricity bill, property tax receipts, Voter ID card, municipality certified document and so forth
- Photograph – Passport sized – 2 copies, not older than 6 months
- Proof of SC/ST, OBC or any minority group, if applicable
- Business Address Proof – Present
- Bank Statement of last 6 months
- Quotation of equipment that is to be purchased
Additional documents required for Kishore and Tarun loan schemes are:
- Sales Documents – Details of transactions and business activities of current financial year
- Financial Documents – Balance sheets, tax returns, and projected balance sheets
- Asset and Liability Statements
- Memorandum and Partnership deeds
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FAQs on Canara Bank Mudra Loan
Q. Who can apply for Canara Bank Mudra Loan?
Ans. Applicants must be an Indian citizen who runs a business or wants to establish a business in the MSME sector. Moreover, applicants must be engaged in manufacturing, service, trade, or agricultural activities other than farming.
Q. How can I check my Mudra loan application status in Canara Bank?
Ans. To check your Mudra loan application status, you shall have to dial the Toll Free or Customer Care number of Canara bank or need to personally visit the bank branch.
Q. Is the overdraft facility of up to Rs 5000 covered in MUDRA scheme?
Ans. No, there is no overdraft facility covered in this scheme.
Q. What is the tenure of a Mudra Loan in Canara Bank?
Ans. Canara Bank Mudra Loan must be repaid within 3 years to 5 years in form of EMIs.
Q. Are all the loans are covered under Credit Guarantee Scheme?
Ans. No, not every type of business loan is covered under CGTMSE. It’s a type of SME loan offered to existing businesses and start-ups.
Q. Are all the MUDRA loan holders eligible for MUDRA Cards?
Ans. Yes, if an applicant has applied and approved for a Mudra loan, then he/she is eligible to avail Mudra card as well.
Q. Can I submit Mudra loan application form online?
Ans. Generally, applicants need to download the form to fill and submit at the nearest bank branch offering Mudra loan. However, there are few banks that accept online filling and submission of Mudra form.
Q. What is Mudra Card?
Ans. Mudra Card is designed to offer convenience to the borrower. Through this card, the borrower can use the working capital loan amount as cash credit. This will greatly help the borrower manage their working capital limit efficiently and keep the interest burden at a minimum. Also, by using the Mudra card the borrower can keep track of their transactions.
Q. What is MUDRA?
Ans. MUDRA (Micro Units Development and Refinance Agency) works as a financial entity to develop and refinance financial intermediaries like banks, Non-Banking Financial Companies (NBFCs), Micro Finance Institutions who lend to MSME enterprises involved in manufacturing, trading and services sector, including non-farm based agricultural activities.