The Pradhan Mantri MUDRA Yojana (PMMY) was introduced by the Narendra Modi government in 2015 to offer loans of up to 10 lakh to small or micro enterprises outside the corporate and farming sectors.
Read More: Stock market trading – 5 key things to keep in mind
MUDRA, representing Micro Units Development & Refinance Agency Ltd, aims to supply funds to these businesses through various financial institutions like Banks, Non-Banking Financial Company (NBFCs), and Microfinance institutions (MFIs). This initiative, announced during the FY 2016 Union Budget, introduced three specific products -‘Shishu’, ‘Kishore’, and ‘Tarun.’ These products signify different stages of growth and funding requirements for micro units or entrepreneurs, providing a guideline for their progression and expansion.
Who are eligible?
The Non-Corporate Small Business Segment (NCSB) includes numerous proprietorship or partnership firms operating as small manufacturing units, service providers, shopkeepers, fruit or vegetable vendors, truck operators, food-service establishments, repair shops, machine operators, small-scale industries, artisans, food processors, and similar entities. These businesses, located in both rural and urban areas, are qualified to access loans through MUDRA. Eligibility criteria:
-The applicant should be a citizen of India.
-Eligible individuals with a viable business plan for a small enterprise can access loans under the scheme. These loans are available for income-generating activities in manufacturing, trading, services, and allied agricultural sectors across the three loan products.
Read More: Are You Looking For Safe And Tax-Efficient Investment Option? Check Benefits Of Tax-Free Bonds
-No record of previous loan defaults should be associated with the applicant.
-The applicant’s business must have a minimum vintage of three years.
-Entrepreneurs applying for the loan should fall within the age bracket of 24 to 70 years.
How to apply?
-Visit the official website www.udyamimitra.in for those interested in applying.
-On the Home Screen, choose the ‘Apply Now’ feature.
-Pick between the options available: ‘New Entrepreneur’, ‘Existing Entrepreneur’, or ‘Self-Employed’.
-For new registrations, input details like the ‘Applicant’s Name’, ‘Email Address’, and ‘Mobile Number’.
-Create an OTP and complete the registration process.
Types of loans
PMMY scheme offers three types of loans:
a)Shishu (loans up to ₹50,000)
b)Kishore (loans above ₹50,000 and up to ₹5 lakh)
Read More: DCB Hikes FD Interest Rates By 10 Basis Points, Check Revised Rates
c)Tarun (loans above Rs. 5 lakh and up to Rs. 10 lakh).
Small businesses that already exist have the opportunity to access credit facilities at fair interest rates to facilitate their expansion endeavours.
