Mudra loans under Pradhan Mantri Mudra Yojana (
PMMY was launched on April 8, 2015 to provide loans of up to Rs. 10 Lakh to non-corporate and non-agricultural small/micro enterprises.
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Purpose of the MUDRA loan
Mudra loan is granted for various purposes resulting in income generation and job creation. Loans are granted mainly for:
* Commercial loan for vendors, traders, traders and other service industry businesses
* Working capital loan via MUDRA cards
* Equipment financing for micro-units
* Loans for transport vehicles – for commercial use only
* Loans for non-agricultural agro-industrial income-generating activities, e.g. fish farming, beekeeping, poultry farming, etc.
* Tractors, tillers and two-wheelers used for commercial purposes only.
Mudra loan categories
Shishu: covers loans up to 50,000/-
Kishor: cover for loans above 50,000/- and up to 5 lakh
Tarun: covering loans above 5 lakh and up to 10 lakh
There is a 2% interest subsidy on prompt repayment of Shishu loans issued under the PMMY for a period of 12 months to all eligible borrowers.
Eligibility for Mudra Loans
Any Indian citizen who has a business plan for non-farm income generating activity such as manufacturing, processing, trading or service sector whose credit requirement is up to 10 lakh can contact a bank, a MFI or NBFC to qualify for MUDRA loans under PMMY. The usual terms and conditions of the lending agency may need to be followed to qualify for loans under the PMMY. Loan rates are in line with the
Under the PPMY, about 68% of the total number of loans were made to women entrepreneurs. The average amount of loans is around Rs 54,000 and 86% of loans are in the “SHISHU” category.
Nearly 22% of loans were granted to new entrepreneurs. About 23% of loans were granted to SC and ST borrowers; About 28% of the loans were granted to OBC borrowers (a total of 51% of the loans were granted to SC/ST/OBC categories of borrowers). About 11% of the loans were granted to borrowers from the minority community.