Federal Bank Mudra Loan

Federal bank is one of the leading commercial bank that offers Mudra loans to its customers, besides specialising in providing banking and financial products. Under Pradhan Mantri MUDRA Yojana (PMMY), Government of India launched MUDRA loan to provide funding to banks and NBFCs for them to further lend it to Micro, Small and Medium Enterprises (MSMEs).

Banks that are eligible to provide the Mudra Loan are Commercial Banks, Small Finance Banks, Cooperative Banks, Regional Rural Banks (RRBs), Non-banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs). Individual willing to avail Mudra Loan can apply to Federal Bank online through the portal. Furthermore, enterprises that are involved in the agricultural or its allied activities can.

Following are the categories offered by the Federal Bank with respect to MUDRA Loan:

Also Read: How to Get a Small Business Loan for New Business

In order to avail the Mudra Loan of Federal Bank, the below mentioned eligibility must be fulfilled

The applicant borrowing under Pradhan Mantri Mudra Yojana can be any individual which includes women, partnership firms, proprietorship, limited liability partnerships or association of persons.

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The Federal Bank in particular charge nominal amount of interest rate on Mudra Loan. Moreover, the interest rate so prescribed varies from time to time which is basically liked to bank’s Marginal Cost Lending Rate (MCLR).

Also Know – What interest rate is charged on MUDRA loan? Compare Rates from All Banks

Primary Security: Under primary Security, the security should be the assets that are basically created out of the Bank’s finance. In addition to the assets created out of Bank’s finance, personal guarantee of promoters, as well as directors must also be provided.

Collateral Security: At present there has been no specification mentioned about collateral security. Hence, there is no requirement of collateral security.

Also Read:  How to get a collateral-free Business loan?

Mudra Loan Tenure: In terms of cash credit or overdraft, it is repayable on demand which is as per the guidelines of the Bank. Moreover there is no requirement of third party guarantee. The bank may charge fee if the internal guidelines so require. Moreover the processing charges in terms of Shishu loans are waived off mostly by all the banks that are eligible to provide the Pradhan Mantri Mudra Yojana.