PM Mudra Yojana: If you are an entrepreneur and are unable to grow your business due to lack of money, or you are facing trouble in getting a loan from the bank, then Pradhan Mantri Mudra Yojana (PMMY) can prove to be a game changer for you. This is a great initiative of the Government of India under which loans are easily made available to small traders. The biggest feature of this scheme is that you do not need to deposit any guarantee or security in it. So let’s know in detail how Pradhan Mantri Mudra Yojana can give new wings to your business!
What is Pradhan Mantri Mudra Yojana (PMMY)
MUDRA is a type of NBFC (Non-Banking Financial Institution), that does not give loans directly to the customers, but funds those financial institutions like commercial banks, microfinance institutions (MFIs), small finance banks, and other NBFCs, which further provide loans to small traders.
In this way, the Mudra scheme extends loans to needy small entrepreneurs who struggle to get loans from the traditional banking system. Its main objective is to empower micro and small enterprises in India by providing them with financial support.
How much loan is available under Pradhan Mantri Mudra Yojana
Under this scheme, it is divided into four main parts based on the loan amount, so that the needs of every level of businessman can be met:
Shishu Mudra Loan
A maximum loan of ₹50,000 is available.
Ideal for those starting a new business on a small scale.
Kishor Mudra Loan
A loan of ₹50,000 to ₹5 lakh is available.
For businesses that have crossed their initial stage and want to expand.
Tarun Mudra Loan
A loan of ₹5 lakh to ₹10 lakh is available.
For established businesses that have large expansion plans or wish to purchase machinery.
Tarun Plus Mudra Loan
Loans available from ₹10 lakh to ₹20 lakh.
For larger micro-enterprises that require more capital for significant expansion or modernization.
This segmentation ensures that you get the right loan amount as per your business size and requirements.
Who gets a loan under Mudra Yojana
Loans are provided to a wide range of small businesses and entrepreneurs under Pradhan Mantri Mudra Yojana. Its wide reach makes it inclusive. It includes:
Small shopkeepers
Home-based businesses (such as tailoring, knitting)
Women entrepreneurs
Farmers
Animal keepers
Small artisans
Startups starting new businesses
MSME (Micro, Small and Medium Enterprises)
Thela Wala (Street Vendors)
Retailers
Small manufacturers
Partnership firms
Limited Liability Partnership (LLP)
In short, this scheme empowers all those small businesses that are having difficulty growing due to a lack of capital.
How to apply for a loan under Mudra Yojana?
If you want to take a loan under Mudra Yojana, you can apply both offline and online:
Offline application process
Go to the office of your nearest bank or lending NBFC institution.
Get the Mudra loan form from there and fill it out carefully.
Attach all the required documents with the form.
Submit the filled form to the concerned officer.
Online Application Process
Go to the Udyamimitra Portal.
First of all, register yourself here.
After this, apply for a loan.
Upload all the required documents.
Select your bank or NBFC institution from where you want to take a loan.
Submit the form.
After this process, the lender (bank or lending institution) will contact you and take your application process forward.
Type of form
If you are applying for a Shishu Mudra loan, then its form will be different. At the same time, the form for taking a loan under Kishor and Tarun Mudra is the same.
Documents required to take Mudra loan
It is mandatory to have some necessary documents while applying for a loan under the Mudra scheme. Without these documents, you will not get a loan:
The applicant must have a passport, voter ID card, Aadhaar card, driving license, and PAN card. Of these, PAN cards and Aadhaar cards are mandatory.
If the applicant comes from a special category like SC/ST/OBC, then a certificate is required.
The applicant must also provide his last 6 months’ bank account statement.
If you are doing business, then proof of age of your business, its operation, etc. may have to be given. However, this depends on the business of the applicant and is not necessarily applicable to everyone.
In how many days does one get a loan under Pradhan Mantri Mudra Yojana
After applying for a loan under the Mudra scheme, the process can usually take 7 to 10 or 15 days. In some cases, it may also take longer, especially if there is any deficiency in the documents or if verification takes time. It is important to be patient.
What is the interest rate of the Pradhan Mantri Mudra Loan
The interest rate of loans available under Pradhan Mantri Mudra Yojana is not decided by Mudra itself. The bank or the lending institution itself decides the interest rate on the loan given under this scheme. Therefore, interest rates may vary in different banks and NBFC institutions.
Union Bank of India: 10.75% to 12%
Canara Bank: 10.30%-12.00%
Bank of Baroda: 9.40%-11.75%
Similarly, other banks and NBFCs fix their interest rates under the Mudra scheme, depending on market conditions and internal policies. Hence, it would be wise to compare the interest rates of different banks before applying.