Mudra Loan

Mudra Loan – Businesses of the 21st century deserve a partner from this century too. And that means only one name – Lendingkart.

What is a MUDRA Loan?

PM MUDRA Loan is part of the Pradhan Mantri Mudra Yojana (PMMY), introduced to support the growth of micro, small, and medium enterprises (MSMEs). It provides financial assistance up to Rs. 10 lakhs to non-farming, non-corporate small business sectors to expand, modernize, or start new ventures.

Benefits and Features of Mudra Loan

  • No Collateral Required: Borrowers don’t need to provide any security or third-party guarantee.
  • Competitive Interest Rates: Interest rates are affordable, typically not exceeding 1% per month.
  • Accessibility: Funds can be accessed easily using a Mudra loan card, avoiding bank visits.
  • Wide Coverage: Available to a range of businesses including vendors, traders, and service providers.
  • Government-Backed: Offers the reliability of a government-endorsed scheme.
  • Flexible Repayment Terms: Designed to accommodate the financial situation of small businesses.
  • Inclusive Financing: Aims to include underbanked and underserved segments of the economy.

Eligibility Criteria for Mudra Loan

  • Age Range: Applicants should be between 18 and 65 years old.
  • Loan Amounts: Ranges from Shishu Yojana (up to Rs. 50,000) to Tarun Yojana (up to Rs. 10 lakhs).
  • Industry Type: Open to individuals and enterprises in manufacturing, trading, and services.
  • Company Status: Available for both new startups (Shishu) and existing businesses looking to expand (Kishor and Tarun).
  • Operational Area: Nationwide, supporting rural and urban enterprises.

Learn about Mudra loan eligibility criteria to ensure you qualify for financial assistance.

Document Required for Availing Mudra Loan

  • Identity Proof: Aadhaar card, PAN card, Driver’s license, or voter’s ID.
  • Address Proof: Passport, utility bills, bank statements, etc.
  • Business Proof: License and address proof of the enterprise, if applicable.
  • Financial Documents: Bank statements, quotation of machinery or equipment to be purchased.

Discover necessary documents for Mudra loan to ensure smooth application process completion.

Business Loan Apply Online

Mudra Loan Interest Rate and Charges

Loan Amount RangeEnterprise TypeInterest Rate Calculation
Up to Rs. 50,000Micro EnterprisesMCLR + Service Provider (SP) Charge
 Small EnterprisesMCLR + Service Provider (SP) Charge
Rs. 50,001 to Rs. 2 lakhsMicro EnterprisesMCLR + SP Charge + Bank Loan.
 Small EnterprisesMCLR + SP Charge + Bank Loan
Rs. 2 lakhs to Rs. 10 lakhsMicro EnterprisesMCLR + SP Charge + Bank Loan.
 Small EnterprisesMCLR + SP Charge + Bank Loan

Learn about Mudra loan interest rates and associated charges for informed borrowing decisions.

Types of PM Mudra Loan

  • Shishu Yojana: Up to Rs. 50,000 for new or small businesses.
  • Kishor Yojana: Rs. 50,000 to Rs. 5 lakhs for businesses ready for expansion.
  • Tarun Yojana: Up to Rs. 10 lakhs for established small businesses aiming for further growth.

Important Terms and Condition about Mudra Loan

Lendingkart emphasizes a modern approach to financing, like MSME MUDRA loan recognizing the evolving needs of businesses in the 21st century. Key terms include:

  • Purpose: Supporting working capital needs and business expansion.
  • Eligibility: Both new and existing companies can apply.
  • Tenure: Typically 3 to 5 years, depending on the agreement.
  • Application Process: Online applications via the Mudra website or app.
  • Utilization: Funds can be used for equipment, machinery, restructuring, and more.
  • Collateral: Not required, offering a more accessible loan product.
  • Product Variability: Shishu, Kishor, and Tarun loans cater to different stages of business development.

This overview provides a comprehensive insight into PM MUDRA loans, designed to fuel the growth of India’s MSME sector through accessible and supportive financial products.

Apply Online Mudra Loan

Many banks offer the facility of business loan and the Mudra loan application can be applied for following the below mentioned steps;

  1. PM mudra loan online apply visit the official website  – https://www.mudra.org.in/ and then download the application form.
  2. Fill this form with accurate details such as name, address, number, and KYC details.
  3. The required Mudra loan documents then need to be submitted along with the application form.
  4. Additional procedures required by the bank, then need to be fulfilled. (This will differ slightly from bank to bank).
  5. Selected bank will then verify the documents.
  6. Loan amount then gets credited to the account post verification

Frequently Asked Question:

Yes, you can apply online visiting the official website Mudra loan – www.mudra.org.in, But you need to have proper business plan to apply business loan.
The documentation is simply based on the type of loan applied for.
The basic aim being income generation, the purpose of the loan serves:
This card is created to make withdrawals of credit easily once loan is sanctioned. It offers flexibility to the borrower as it works like a credit card, which can be swiped as per requirement. The limit on this card is given in the form of an overdraft loan and one can make multiple withdrawals. Lastly, it also helps keeping track of withdrawals digitally to avoid any error.
Yes, under the MUDRA Credit Guarantee Scheme promoted by the Government of India to mitigate collateral and security concerns of the lending institutions.
It aims to build a business eco-system by offering the following:
  • Counselling centres for financial literacy.
  • Imparting product knowledge.
  • Oversee credit absorption capacity.
  • The need for products and services.
The major schemes of the Government like Make in India, Stand-Up India and Start-up India are the synergies aligned with the MUDRA loan scheme.
The normal term of repayment is 12 to 60 months.
It is normally processed in 24 hours.
Some lenders do offer to existing customers through the MUDRA loan application process.
Yes. Many banks offer this facility so you can visit any one of the private or commercial banks and an executive will guide you through the process.
Reasonable interest rates are levied upon the Mudra loan as per the RBI guidelines. No more than 1% interest on a monthly bases will be charged. However, this is largely dependent on borrower’s credit and repayment history.
There is no discrimination against physically challenged people and anyone within the eligibility criteria can apply for this loan.
Yes. However, this is not applicable for private vehicles. Any car, taxi, bus or truck that is bought by the funds availed from the Mudra loan will need to be used only for public transport.
Yes. For Shishu Yojana, there is a one page form whereas for Kishor Yojana and Tarun Yojana there is a three-page format.
No. No collateral or third party security is required for availing loan under the pm Mudra yojana.
MUDRA stands for Micro Units Development and Refinance Agency.
The maximum age to avail the mudra loan is 65 years. Beyond that, you won’t be eligible.
Units that make pickles, jams, ice-creams, papads, bakeries, sweet shops, cold storage and agricultural produce centres are eligible.
The maximum Mudra loan amount you can apply for under the Pradhan Mantri Mudra Yojana (PM Mudra Loan) depends on your eligibility and the nature of your business or enterprise. Generally, Mudra loans are categorized into three segments – Shishu, Kishor, and Tarun, with loan amounts ranging from INR 50,000 to INR 1 lakh. Interest rates for Mudra loans are competitive, and you can apply for them online through designated financial institutions and banks as part of the Mudra Yojana scheme.

Mudra Loan Latest News:

Mudra Loans Hit Rs 5 Trillion Milestone in FY24

Mudra Loans have surpassed the Rs. 5 trillion mark in FY24, marking a monumental achievement in the journey of small business financing. Introduced by the Government of India under the Pradhan Mantri Mudra Yojana (PMMY), Mudra Loans aim to provide financial support to micro, small, and medium enterprises (MSMEs), enabling them to expand, modernise, or start new ventures.

Mudra Loans are designed to offer collateral-free funding up to Rs. 10 lakhs to non-farming, non-corporate small business sectors. This initiative addresses the financing needs of underbanked and underserved segments, promoting inclusive growth and entrepreneurship.

Key Features and Benefits:

  • No Collateral Required: Makes loans accessible to a broader range of businesses.
  • Competitive Interest Rates: Typically not exceeding 1% per month
  • Accessibility: Easy access via Mudra loan card.
  • Wide Coverage: Supports various business segments, fostering a diverse entrepreneurial ecosystem.
  • Government Backing: Instills confidence among borrowers and lending institutions.

Mudra Loans are categorized into three types based on the loan amount: Shishu (up to Rs. 50,000), Kishor (Rs. 50,000 to Rs. 5 lakhs), and Tarun (up to Rs. 10 lakhs).

In FY24, the milestone of Rs. 5 trillion in disbursals underscores the scheme’s effectiveness in supporting small businesses and driving economic development. This achievement reflects the growing demand for accessible and inclusive financing among entrepreneurs.

News Updated Date: 10th June 2024

Expanding Opportunities: BJP’s Plan to Double MUDRA Loan Limit to Rs 20 Lakh

The BJP has committed in its latest manifesto to increase the loan amount limit under the MUDRA scheme to Rs 20 lakh, effectively doubling the current cap. This promise comes as part of the party’s strategy to enhance support for entrepreneurship and increase employment opportunities across various sectors such as manufacturing, services, and rural industries. The manifesto highlights the government’s intention to expand economic opportunities particularly for OBC, SC, and ST communities by offering increased financial support through the Pradhan Mantri Mudra Yojana (PMMY). PMMY, originally catering up to Rs 10 lakh for micro enterprises, aims to facilitate greater access to credit for budding entrepreneurs. This enhancement will particularly benefit those who have previously availed and successfully repaid loans under the scheme’s Tarun category. The BJP asserts that their policies under the MUDRA initiative have already facilitated substantial job creation and promise to further bolster these efforts if re-elected.

News Updated: 19th April 2024