United Bank of India is a government-owned bank that offers Mudra loans in addition to other lending products. Under Pradhan Mantri Mudra Yojana Scheme (PMMY), government of India has initiated Mudra scheme (Micro Units Development and Refinance Agency) under which people are offered loans maximum up to Rs. 10 lakh. Mudra loan is offered at an interest rate of 12.35% onwards to individuals, MSMEs in trade, manufacturing and services sectors.
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Features and Benefits of Mudra Loan
Under the PMMY, United Bank of India is providing the applicants with some of unique features which will benefit the borrowers in their businesses. Some of the features of United Bank of India’s mudra loan are as follows:
- No Processing fees required
- No collateral required
- Repayment period of the loan is extended up to 5 years
- Applicant should not be defaulter of any Bank/Financial Institution
Other benefits offered by PMMY are as follows:
- Mudra loan provides financial assistant to the needed
- It ensures banking to the unbanked
- It provides credit to the small-scale businesses and micro enterprises
- The interest rate on loans under PMMY will be based on the MCLR decided by the Reserve Bank of India
Individuals, Groups, Entities who can avail loan under PMMY are as follows:
- Partnership / Proprietorship firms
- Small manufacturing units / food service units
- Repair shops
- Small industries
- Truck operators
- Shopkeepers / Fruit or vegetables vendors
- Service sector units
- Other industries in rural and urban areas
- Agriculture sector Enterprises
- Income generating firms
Related Post: What is the eligibility criteria for Business loan?
United Bank of India Mudra Loan Categories
Like all other private or public sector banks or NFBCs, United Bank of India also provides Mudra loan that comes in three categories named as Shishu, Kishor and Tarun which are as follows:
- Shishu- Under this category, the proposed loan amount is Rs. 50,000/-. In this category, banks or financial institutes cater to entrepreneurs who are in their initiative stages of starting a business. As the amount is limited, this helps those only who are in need of small amount to invest in their new or existing business
- Kishor- Under Kishor scheme, entrepreneurs who are in need of amount from Rs. 50,000/- to that of Rs. 5 lakhs are benefited. This is helpful to those who need to start a medium range business or expand their existing business
- Tarun- Under PMMY, this is the highest sanctioned loan. In this category, the entrepreneurs are provided with maximum amount of Rs. 10 lakh. Those who qualify through the eligibility criteria can avail the loan under this category
Documents Required for Loan Application
- Business Plan
- Duly filled application form
- Self-attested copy of Voter’s ID card/Driving licence/PAN card/Aadhaar card/passport/photo IDs issued by Governmental authority is required for identity proof
- As a Residence proof, the applicant has to submit any of recent telephone bill/electricity bill/property tax receipt (not older than 2 months)/Voter’s ID card/Aadhaar Card/ passport of Individual or proprietor/partners bank passbook or latest account statement duly attested by bank officials/domicile certificate/certificate issued by Govt. authority or local Panchayat or Municipality, etc.
- Recent 2 copies photograph of the applicant (not older than 6 months)
- Quotation of machinery/other items to be purchased (under ‘Shishu’ category)
- Name of supplier/details of machinery/price of machinery and/or items to be purchased
- Proof of identity/address of the business enterprise- copies of relevant licenses/registration certificates/other documents pertaining to the ownership, identity of address of business unit, if any
- Sales achieved during the current financial year up to the application date
- Project report containing details of technical and economic viability
- Memorandum and articles of association of the company/partnership deed of partners, etc.
- Projected balance sheet of one year in case of working capital limits. (applicable for loan of Rs. 2 lakh and above)
- Proof of category like SC/ST/OBC/Minority, etc.
- Annexure on total net-worth/Income of the borrower
Also Read: How to get subsidy in Mudra loan?
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Ques.1: What is the interest rate provided by United bank of India under PMMY?
Ans: United Bank of India provides MSME loan at an interest rate of 12.25% onwards.
Ques.2: Are hand loom activities will come under Mudra loan eligibility?
Ans: Yes. Any income generating activities are applicable for the loans under PMMY scheme. As hand loom falls under the textile sector, it is eligible to avail Mudra loan.
Ques.3: What can be the least amount availed under PMMY?
Ans: Minimum amount that can be availed under PMMY has no citeria.
Ques.4: How to apply for United Bank of India’s Mudra loan?
Ans: You can go to the nearest branch of United bank of India with all the required documents and can apply for the loan.
Also Know: How to Get a Business Loan for Your Startup
Ques.5: Am I eligible for United Bank of India’s Mudra loan to start a food stall?
Ans: Yes. You are eligible for United Bank of India’s Mudra loan to start of your food stall.