Pradhan Mantri Mudra Yojana
( Center Level )
Under the Pradhan Mantri Mudra Yojana, entrepreneurs in the country are receiving assistance in obtaining loans from banks at concessional rates. Our Prime Minister, Shri Narendra Modi, launched this scheme on April 8, 2015. Under the Pradhan Mantri Mudra Yojana, individuals interested in obtaining a loan from the bank can apply.
Highlights
).pngscheme_8.png)
About Pradhan Mantri Mudra Yojana
The Pradhan Mantri Mudra Yojana (PMMY) is a flagship initiative by the Government of India. This scheme offers microcredit/loans up to Rs. 10 lakhs to micro enterprises engaged in income-generating activities within the non-farm sector, including manufacturing, trading, and services, as well as agriculture-related activities such as poultry, dairy, and beekeeping. The scheme provides financial assistance through Member Lending Institutions to support income-generating activities of micro and small entities in the non-corporate, non-farm sector.
These micro and small entities include millions of proprietorships/partnership firms operating as small manufacturing units, service units, shopkeepers, fruit/vegetable vendors, truck operators, food service units, repair shops, machine operators, small industries, artisans, food processors, and others.
Loans under the Pradhan Mantri Mudra Yojana can be accessed through eligible Member Lending Institutions (MLIs), which include:
- Public Sector Banks
- Private Sector Banks
- State-operated cooperative banks
- Regional Rural Banks
- Micro Finance Institutions (MFIs)
- Non-Banking Finance Companies (NBFCs)
- Small Finance Banks (SFBs)
- Other financial intermediaries approved by Mudra Ltd. as member financial institutions
Interest Rate:
The interest rates are set by the Member Lending Institutions in accordance with Reserve Bank of India guidelines, which determine the applicable interest rate.
Upfront Fee/Processing Charges:
Banks may charge an upfront fee as per their internal guidelines. However, the upfront fee/processing charges for Shishu loans (covering loans up to Rs. 50,000) are waived by most banks.
Note: MUDRA does not engage any agents or intermediaries for availing Mudra Loans. Borrowers are advised to avoid individuals claiming to be agents or facilitators of MUDRA/PMMY.
Benefits of Pradhan Mantri Mudra Yojana
Under the Pradhan Mantri Mudra Yojana, entrepreneurs in the country are reaping significant benefits, making it easier for them to obtain loans from banks. This scheme offers loans at concessional rates.
Under the Pradhan Mantri Mudra Yojana, entrepreneurs have the opportunity to receive loans up to Rs. 10 lakhs from banks, even if their applications were previously rejected.
Through this scheme, entrepreneurs can obtain loans without any collateral. It provides them with the financial stability and freedom to start new businesses.
Under this scheme, citizens can receive loans from the government to start their own businesses, helping them take a strong step towards self-reliance.
Types of Pradhan Mantri Mudra Yojana
The scheme is divided into three categories: 'Shishu', 'Kishore', and 'Tarun', indicating the stage of growth and funding requirements of the beneficiary micro unit or entrepreneur.
- Shishu: Loans up to Rs. 50,000.
- Kishore: Loans above Rs. 50,000 and up to Rs. 5 lakhs.
- Tarun: Loans above Rs. 5 lakhs and up to Rs. 10 lakhs.
Eligibility of Pradhan Mantri Mudra Yojana
Individuals, proprietary concerns, partnership firms, private limited companies, public companies, and any other legal forms are eligible under this scheme.
- The applicant must not have defaulted on any loans from banks or financial institutions and should have a satisfactory credit track record.
- Individual borrowers may need to possess the necessary skills, experience, or knowledge to undertake the proposed business activity.
- The requirement for educational qualifications, if applicable, is assessed based on the nature of the proposed activity and its specific needs.
Activities/Usage of Pradhan Mantri Mudra Yojana
This loan is provided under the Pradhan Mantri Mudra Yojana to increase income and employment. It is given for the following activities:
- Business loans for retailers, traders, shopkeepers, and other service businesses.
- Working capital loans through Mudra cards.
- Financial assistance for equipment for micro-enterprises.
- Loans exclusively for commercial use transport vehicles.
- Agriculture-related: Loans for non-farm income generation activities (such as fishery, beekeeping, poultry farming).
- Loans for tractors and two-wheeler vehicles used exclusively for commercial purposes.
Pradhanmantri Mudra Yojana Card
Mudra cardholders are provided with a type of debit card by banks, which allows them to easily withdraw money from their bank accounts. This card functions like an ATM card and can also provide loans up to a predetermined limit set by the bank in the cardholder's name. Through the Mudra card, the capital requirements of businesses can be met and it can be used digitally. Additionally, beneficiaries can withdraw money from any ATM in the country using the Mudra card, which helps them meet their financial needs, and they can also make payments through point of sale machines.
How to apply
Pre-requisites for the enrolment process
- ID Proof
- Address Proof
- Passport size photograph
- Applicant Signature
- Proof of Identity / Address of Business Enterprises
Step 1
Visit the PM MUDRA official website and then select the Udyamimitra portal.
Step 2
Click on "Apply Now" for Mudra loan.
Step 3
Choose one of the following options: New entrepreneur / Existing Entrepreneur / Self-employed professional.
Step 4
Enter the applicant's name, email, and mobile number, and generate OTP.
After Successful Registration: Step 5
Fill in Personal Details and Professional Details.
Step 6
Select hand-holding agencies if assistance is needed for preparing project proposals, otherwise click "Loan Application Center" and proceed.
Step 7
Choose the category of loan required - Mudra Shishu / Mudra Kishore / Mudra Tarun.
Step 8
Provide Business Information such as business name, business activity, etc., and select the industry type like Manufacturing, Service, Trading, or activities allied to agriculture.
Step 9
Complete other details including owner details, existing Banking/Credit facilities, proposed credit facilities, future estimates, and preferred lender.
Step 10
Attach all necessary Documents such as ID proof, Address proof, Applicant photo, Applicant Signature, Proof of Identity/Address of Business Enterprise, etc.
Step 11
Once the application is submitted, an Application Number will be generated which should be kept for future reference.
FAQ's
Is Khadi Activity Eligible Under PMMY Loans?
Yes. MUDRA loans are applicable for any activity that generates income. Khadi is eligible under the Textile sector, and if MUDRA loans are used for income generation purposes, Khadi activities can be covered.
Are MUDRA Loans Available For Purchase Of CNG Tempo/Taxi?
Yes, MUDRA loans are available for the purchase of CNG Tempo/Taxi, provided the vehicle is intended for commercial use.
I Have A Savings Bank Account With the Bank, Would Loan Under MUDRA Be Available Based On The SB Account?
Yes, applicants with a savings bank account can approach the branch and apply for MUDRA loans as per the format provided by the lending institution. The terms and conditions of the loan will be governed by the policies of the lending institution, based on RBI guidelines. The loan amount will depend on the income generating activity's requirements, and repayment terms will be determined by anticipated cash flows.
Under PMMY-Shishu Loans, What Is The Turn Around Time For Processing The Loan Proposal?
According to the Banking Codes and Standard Board of India (BCSBI) established by RBI, loan applications for credit limits up to Rs. 5 lakh should be processed within 2 weeks.
Is It Required To Submit Income Tax Returns For The Preceding 2 Years For Availing Loan Of Rs. 10 Lakh Under PMMY?
Generally, income tax returns are not mandatory for small value loans. However, specific document requirements will be advised by the lending institutions based on their internal policies and guidelines.
This may interest you