Pradhan Mantri MUDRA Yojana (PMMY) | Apply Online Mudra Loan, Eligibility, List of Documents

Pradhan Mantri MUDRA Yojana (PMMY) | Mudra Loan

The Micro Units Development and Refinance Agency (MUDRA) loan scheme under the Pradhan Mantri Mudra Yojana (PMMY) is an initiative of the Indian government that provides loans to individuals, SMEs, and MSMEs. The PMMY scheme launched by the Honourable Prime Minister on April 8, 2015. This Mudra loan under three loan schemes, namely Shishu, Kishore, and Tarun. The maximum loan amount given under the MUDRA scheme is Rs. 10 lakhs. Banks or loan institutions must not make any guarantee or mortgage to avail of the Mudra Loan Scheme. The repayment of the Mudra loan ranges from 3 years to 5 years with EMI options.

Features of Mudra Loan

1. Rate of interest- different from bank to bank, depends on business requirements.
2. Guarantee / Security – not required
3. Minimum loan amount – not fixed
4. Maximum loan amount – up to ₹ 10 lakhs
5. Repayment period – 3 years to 5 years
6. Processing Fee – Nil

Types of Mudra Scheme – Shishu, Kishore, and Tarun

Individuals can avail of mudra scheme only, SME, MSME, businesses manufactured, trade, and service sectors.

Benefits of Mudra Loan

Types of Mudra Loans

They divided the mudra loan into three types in terms of growth, development of the business, and need for money:

Shishu Loan: The loan for those looking for financial help and want to start their own business. Under this, the maximum loan amount is Rs 50,000. Its interest rate ranges from 10% to 12% per annum, with a repayment period of 5 years.

Kishore Loan: This loan is for those whose business has already started but has not been established yet. The loan amount given under this varies from Rs 50,000 to Rs 5 lakh. The rate of interest varies depending on the lending institution. Along with the business plan, the applicant’s credit record plays a vital role in deciding the interest rate. The bank chooses the term of repayment.

Tarun Loan: This is for those who have established businesses and need money to expand and purchase the property; the loan amount is between 5 lakh to 10 lakh. It based on the interest rate and repayment period, on the credit record of the plan and the applicant.

The interest rates of all these Mudra Loans can vary from bank to bank.

The major objective of Pradhan Mantri Mudra Yojana

• Commercial Vehicles: Purchase of commercial vehicles such as tractors, auto-rickshaws, taxis, trolleys, tillers, freight transport vehicles, 3-wheelers, e-rickshaws, etc.
• Service Sector Activities: Starting a business of salons, gyms, tailoring shops, medicine shops, repair shops, and dry cleaning and photocopying shops, etc.
• Food and Textile Manufacturing Sector Activities: Various Activities in the Related Sector
• Business activities for traders and shopkeepers: Establishment of shops, service enterprises, trade activities, and non-agricultural income-generating activities.
• Equipment Finance Scheme for Small Businesses: Maximum Rs. 10 Lakhs.
• Agro-allied activities: Agri-clinics and agribusiness centers, food and Agro-processing units, poultry, fisheries, beekeeping, pruning, livestock rearing, grading, Agro-industries, diary, fisheries, etc.

Some famous institutions that offer Mudra loans in India

• Bank of Baroda, Syndicate Bank
• Central Bank of India, United Bank of India
• HDFC Bank, Andhra Bank
• Indian Overseas Bank, Bank of Maharashtra
• Oriental Bank of Commerce, Dena Bank
• State Bank of India, IDBI Bank
• Union Bank of India, Karnataka Bank
• Allahabad Bank, Punjab National Bank
• Bank of India, Tamilnad Mercantile Bank
• Corporation Bank, Axis Bank
• ICICI Bank, Canara Bank
• J&K Bank, Federal Bank
• Punjab and Sind Bank, Indian Bank
• Kotak Mahindra Bank, UCO Bank

Documents Required for Mudra Loan

1. Business plan
2. Application form
3. If applicable, passport size photographs of applicant and co-applicant
4. KYC documents of applicants and co-applicants
5. Proof of Identity (Aadhaar Card / Voter ID Card / Passport / Driving License, etc.)
6. Proof of residence (Aadhaar card / voter ID card / passport / telephone bill / bank statement, etc.)
7. Income proof (ITR, sales tax return, license, registration, etc.)
8. Proof of a particular category, such as SC, ST, OBC, minority. (if applicable)
9. Business address and tenure proof, if applicable
10. Registration, license, or certificate (if any).