Mudra Loan: PMMY Mudra Bank Loan Scheme Details

Mudra Loan

Learn all about Pradhan Mantri Mudra Loan Yojana. The financial scheme is launched by the government in 2016 under MUDRA. MUDRA stands for Micro Units Development and Refinance Agency bank. The Mudra bank is a new financial institution established by the Government of India. Its main purpose is to look after the development and refinancing of the micro units. Small business sectors get funding at affordable low-interest rates. Mudra Loan scheme is sanctioning loans to the small existing entrepreneurs and start-up units. Applicants for the Mudra will get all details of this funding project.

 

The Mudra bank yojana is mainly aimed at boosting Indian youth to create jobs instead of seeking jobs. The project comes to relieve independent entrepreneurs who can get loans and other financial products for their business. Any non-corporate and small sized business units indulged in the retail business, trading, processing, and manufacturing are given funding under the scheme. Micro credit up to Rs. 10 lakh is facilitated to the small business owners. If you have planned to take benefit of this scheme, check the details of the mudra loan yojana. The mudra bank has a corpus of more than Rs. 70 crores.

 

Also check related article: Pradhan mantri jan dhan yojna

Mudra Loan

Mudra Bank Loan Application Procedure

Do you want to know in details how to apply for Mudra loan? The mudra yojana is administered by the major banks like ICICI, SBI, HDFC, Kotak Mahindra, and Axis bank. The scheme is also provided by hundreds of other banks.

Here is your step-by-step guide to apply for Mudra bank loan:

  1. Approach any of the loan providing bank listed under the scheme.
  2. Furnish all the details of your business to the bank.
  3. After knowing the details, the bank would categorize your business into any of the following three categories of the mudra loan scheme:
  • Shishu – Provides loan of up to Rs. 50,000/- (for start ups)
  • Kishore – Provides loan form Rs. 50,000/- to Rs. 5 lakh.
  • Tarun – Loan of above Rs. 5 lakh and below Rs. 10 lakh is provided under this category.
  1. Get the form to apply for mudra bank loan from the bank. Fill up the form along with the current account in the bank.

Mudra bank loan

Eligibility to Apply for PMMY

The government has set criteria for firms and entrepreneurs who want to apply for the mudra bank loan. Below are the eligibility criteria for mudra loan yojana scheme:

  1. The applicant should be an Indian citizen.
  2. The loan is provided only for small scale and micro businesses of the rural regions.
  3. An applicant who has a valid and accepted proof of identity, proof of residence. The applicant should be able to provide two set of photographs of the proprietor or directors or partners.
  4. The maximum amount of the loan applied should be Rs. 10 lakhs.

You need to fulfill above criteria along with submitting required papers. If your loan is approved, the bank will sanction it in due course.

Mudra Loan Yojana Interest Rates

It is difficult to provide interest rates under this scheme as the rates vary with the bank. However, the most of the banks are charging interest rate starting from 11% to 13%. The United Bank of India and Union Bank of India is charge 9.65% to 11.15%. Bank of Baroda is charging 14%. Once you approach the bank, you will know the exact interest rate from them. You can get more information on the scheme by visiting the official portal mudra.org.in. The beneficiaries get a period of 5 to 7 years to repay the loan amount.

Documents Required for MUDRA Bank Loan Application

Following are the documents required to apply for Pradhan Mantri mudra yojana.

  1. Identity proof
  2. Proof of residence and proof of business address.
  3. If the business is already established, balance sheets for last three years are required.
  4. Income tax return and sales tax returns for last three years if applicable.
  5. Certificate of incorporation in the case of company. A written proposal or partnership deed as applicable.
  6. If the business is run on the rented premises, a copy of the rental agreement.
  7. SSI or MSME certificates if applicable.
  8. Projected balance sheet for the next 2 years for the cases with loan of Rs. 2 lakhs or above that.
  9. Other additional documents required by the bank.

The Pradhan Mantri Mudra Yojana is overall a beneficial scheme for small and medium sized entrepreneurial units.

So far the scheme has shown good performance in few states. Till April 2016, the Pradhan Mantri mudra loan yojana has served 9.5 lakh entrepreneurs under the shishu loan category. Loans worth Rs. 2111 crore are disbursed under shishu category. Rs. 1.8 crore are disbursed under Kishore and Tarun loan categories of mudra yojna scheme during the past 12 months. You might also be interested in other governmental programmes posted on our blog. Consider reading Pradhan mantri jeevan jyoti bima yojana and suraksha bima yojana too.

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