Pradhan Mantri Mudra Loan Yojana (PMMY) | Pradhan Mantri Mudra Yojana Application – The Pradhan Mantri Mudra Yojana provides MUDRA Loans (PMMY). MUDRA Loan Scheme was started in 2015 to provide loans of up to Rs 10 lakh. Main objective of this Loan scheme is to make available easy business loans. Micro-Units Development and Refinance Agency is what MUDRA stands for. Borrowers can get business loans ranging from Rs.50,000 to Rs.10 lakh under this scheme, which is divided into three categories: Shishu, Kishor, and Tarun.
Due to a lack of security and insufficient finances to pay off high-interest rates, MSMEs frequently find it difficult to get loans from banks through standard borrowing channels. To address this, the Indian government created the Pradhan Mantri MUDRA Yojana (PMMY) in 2015, which aims to help small and medium-sized businesses expand and develop faster.
Categories of Pradhan Mantri MUDRA Loan scheme
| Category | Loan Amount |
| Shishu | Up to Rs.50,000 |
| Kishor | Rs.50,000 to Rs.5 lakh |
| Tarun | Rs.5 lakh to Rs.10 lakh |
What is the Pradhan Mantri Mudra Loan for?
Yojana E MUDRA loans can be used for a variety of purposes, including job creation and income generation. The following are the most common uses for Mudra loans:
- Shopkeepers, traders, vendors, and other service-related businesses can apply for a business loan.
- Equipment financing for small businesses
- MUDRA cards provide a working capital loan.
- Loans for transportation vehicles
- Mudra Loans are available to people who work in agri-allied non-farm income-generating businesses such as poultry farming, beekeeping, pisciculture, and so on.
- A Mudra Loan is available to anyone who utilizes tractors, tillers, or two-wheelers for commercial purposes.
Activities covered under Mudra Loan
The following is a list of activities that are covered under the E Mudra Yojana Loan:
- Transport vehicles for both cargo and passengers in the food products sector
- Personal, social, and community service activities
- Shopkeepers and traders can get business loans.
- The textile industry and its activities
- Agriculture-related endeavors
- Micro Units Equipment Financing Program
Benefits of Mudra Loan
The following are the main characteristics and advantages of a E Mudra loan Yojana:
- Both rural and urban communities have access to banking and financial services.
- Micro-small companies and start-ups can get financial support.
- Small business loans with reasonable interest rates are available.
- The government assumes the borrower’s credit guarantee, which means that if the borrower is unable to repay the loan, the government will be responsible for the loss.
- This programme can benefit food vendors, merchants, and other small business owners.
- This programme provides financial assistance to persons who do not have access to basic banking services.
- The scheme’s repayment duration can last up to seven years.
- Women are eligible for a loan with lower interest rates.
- Refinance options are also available through certified lenders.
- The Tiny Credit Scheme is available to those who want to produce revenue through micro enterprise operations.
- The Mudra financing scheme works in tandem with the government’s “Make in India” campaign, which aims to stimulate innovation, facilitate investment, increase skill development, and build the country’s best industrial infrastructure.
- This method does not require any collateral or security.
- The money loaned under this plan can only be utilized for business.
Eligibility for MUDRA Loans| PM Mudra Loan Eligibility
E Mudra loans are available to Indian nationals who have their own business plans for service sector, commercial, or industrial operations and require funds of up to Rs.10 lakh. Public and private sector banks, regional rural banks (RRBs), small finance banks (SFBs), and micro financing institutions also offer it (MFIs).
An applicant for a MUDRA Loan must meet the following eligibility criteria:
| Minimum age limit | 18 years |
| Maximum age limit | 65 years |
| Who can avail a Mudra Loan | Loans can be availed by new and existing business units |
| Security or collateral requirement | No collateral or third-party security is required |
| Institutions eligible to offer Mudra Loan | Public Sector Banks, Private Sector Banks, Micro Finance Institutions, and Regional Rural Banks |
Small firms can also apply for loans under the PMMY scheme for commercial purposes, as listed below.
- Buying automobiles, vehicles, two-wheelers, or any other type of vehicle
- capital for operations
- For machineries and plants
- Renovating or remodeling a commercial space
- Mudra also runs a special refinance scheme for female entrepreneurs called Mahila Uddyami Scheme, which aims to empower women in business.
Pradhan Mantri Mudra Loan Interest Rates based on Business Model
The interest rate applied on E MUDRA loans are based on RBI defined MCLR (Marginal Cost of Lending Rate) with the following break-up.
Interest Rate on up to Rs.50000 PM Mudra Loan
- Micro Enterprises: MCLR + SP
- Small Enterprises: (MCLR + SP) + Bank Load
Above Rs.50000 up to Rs.2 Lakhs
- Micro Enterprises: (MCLR + SP) + Bank Load
- Small Enterprises: (MCLR + SP) + Bank Load
Above Rs.2 lakhs up to Rs.10 lakhs
- Micro Enterprises: (MCLR + SP) + Bank Load
- Small Enterprises: (MCLR + SP) + Bank Load
Bank Interest Rates of Mudra Loan
| Bank | Interest Rate | Tenure |
| State Bank of India (SBI) | Linked to MCLR | 1-5 years |
| ICICI Bank | As per bank guidelines | At the discretion of the bank |
| IDBI Bank | Linked to Bank’s Base Rate and Rating | 1-5 years |
| UCO Bank | 8.85% p.a. onwards | At the discretion of the bank |
| Bank of Baroda | 9.65% p.a. | At the discretion of the bank |
| Indian Overseas Bank | As per bank guidelines | At the discretion of the bank |
| Union Bank of India | 7.30% p.a. onwards | At the discretion of the bank |
| HDFC Bank | As per bank guidelines | At the discretion of the bank |
| Canara Bank | As per bank guidelines | Up to 7 years |
| Central Bank | As per bank guidelines | At the discretion of the bank |
| Allahabad Bank | As per bank guidelines | 1-5 years |
| Bank of Maharashtra | 9.25% p.a. | At the discretion of the bank |
| Bank of India | Linked to MCLR | 1-7 years |
| Vijaya Bank | 9.65% p.a. (Merged with Bank of Baroda) | At the discretion of the bank |
| Oriental Bank of Commerce | As per bank guidelines | At the discretion of the bank |
| Tamilnad Mercantile Bank | 8.95% p.a. onwards | 1-7 years |
What is Mudra Card – Pradhan Mantri Mudra Yojana
The MUDRA Card is a debit card for the working capital portion of the loan that is issued against the MUDRA loan account. The borrower can utilize the MUDRA Card for repeated drawals and credits in order to efficiently manage the working capital limit and keep the interest burden to a minimal. The MUDRA Card also aids in the digitization of MUDRA transactions and the establishment of a credit history for the borrower. MUDRA Card can be used to withdraw cash from any ATM or mini ATM in the country, as well as to make payments at any ‘Point of Sale’ machines.
Documents Required for Mudra Loan
Applicants must attach a copy of the following papers to the application form in order to be considered for a Mudra loan.
- A detailed business plan
- Completed application form available for download on the bank’s website
- 2 passport-sized photos taken recently
- Proof of age or date of birth; this could be your passport, voter’s ID card, driver’s license, or Aadhar card.
- Address verification
- Bank statement from the previous six months
- If the candidate falls into the SC/ST/OBC or any other special category, they must provide documentation of their status.
How to Fill Application Form for Pradhan Mantri Mudra Loan Scheme
How to apply for Mudra Loan Online
Commercial banks, RRBs, small finance banks, MFIs, and NBFCs all have official websites where businesses can apply for Mudra loans.
Follow these procedures to apply for a E Mudra Yojana:
Step 1 – Applicants have to visit the Udyami Mitra official website https://www.udyamimitra.in/
Step 2 – Now here you have to register for the Udyami Mitra Portal.
Step 3 – After that click on apply online for MUDRA Yojana Loan
Step 4 – Fill in all the required fields accurately and Submit the form
Step 5 – Your application shall be viewed by many lenders for credit support.
Step 6 – These lending agencies and banks will contact you for further formalities and discussion
Step 7 – Follow the bank representative’s instructions on the formalities.
Step 8 – After processing and validating the loan application form and related papers, the bank will approve and disburse the loan amount.
How to apply for Mudra Loan Offline
- Visit the nearest branch of the bank you want to get a Mudra loan from.
- Present your own business strategy to the appropriate authorities.
- Submit the completed loan application form that you downloaded.
- As requested by the relevant authorities, submit the needed documentation.
- After verification, the bank will approve and disburse the loan amount.
Limitations of Mudra loan
- A maximum loan amount of Rs. 10 lakh can be given.
- Depending on the activity/income creation, the repayment duration ranges from 3 to 5 years, with a 6-month moratorium. Annual evaluation of the WC/TL
- Shishu and Kishore have no processing costs, however Tarun loan categories have a processing fee of 0.50 percent (plus applicable tax).
Useful Links for Pradhan Mantri Mudra Scheme
| Register for Mudra Yojana | Click here |
| Login for PM Mudra Yojana | Click here |
| Udyami Mitra Official Website | Click here |
| MUDRA official website | Click here |
| Our Website | Click here |