Mudra Loan
Micro Units Development and Refinance Agency (MUDRA) is a new institution set up by Government of India as a wholly owned subsidiary Small Industries Development Bank of India (SIDBI) to provide funding for the development and refinancing activities of micro units. It majorly focuses on the non-corporate, non-farm sector income generating activities of micro and small enterprises whose credit needs are below Rs. 10 Lakh.
The main objective of this scheme is to 'fund the unfunded'. There are millions of micro units existing outside the formal banking system who need funds and unable are to grow due to the lack of finance or are relying on informal channels of funding like private moneylenders often at high-interest rates.
In an attempt to bring such enterprises into the formal financial system and extending affordable credit to them, the Micro Units Development and Refinance Agency has been launched.
In an attempt to bring such enterprises into the formal financial system and extending affordable credit to them, the Micro Units Development and Refinance Agency has been launched.
Under the umbrella of Pradhan Mantri MUDRA Yojana (PMMY), MUDRA is offering three unique products as per the need and growth of the micro-enterprise. These schemes cover loan amounts as below:
• Shishu: covering loans up to Rs. 50,000
• Kishore: covering loans above Rs. 50,000 and up to Rs. 5,00,000
• Tarun: covering loans above Rs. 5,00,000 and up to Rs. 10,00,000
The dispersal of loans below Rs. 50,000 to be given more focus.
Eligibility
All Non-Corporate Small Business Segment (NCSBS) consisting of proprietorship or partnership firms are eligible for funding under MUDRA. Shopkeepers, fruits/vegetable vendors, truck and taxi operators, food-service units, repair shops, machine operators, small industries, food processors and others in rural and urban areas running small manufacturing units, service sector units, are eligible.
Security
Loans under this scheme are collateral-free loans, there is no need to pledge any asset as security to avail the loan. Additionally, third party guarantee is not required.
Interest rate
The interest rate is linked to the lender's Base Rate and other internal lending policies.
MUDRA Card
A MUDRA card is issued against the MUDRA loan account to manage the borrowed amount efficiently, the card comes with RuPay incorporation, the Indian payment system equivalent of VISA/MasterCard through which the credit history of the account can be tracked. If used optimally this can help in creating a positive credit score for the borrower.
How to avail financing under MUDRA scheme
Designated public and private banks would facilitate loans under this scheme as per customer requirements on filling the MUDRA application form.
If you are looking for a loan under this scheme and are unsure about how to apply, then CreditMantri can guide you. You can check your eligibility and apply for a loan by signing up with CreditMantri. It is quick, simple and above all, free.
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