PRADHAN MANTRI MUDRA YOJANA
Pradhan Mantri Mudra Yojana (Micro Unit Development and Refinance Agency Ltd.) PMMY is a scheme by The Union Government, introduced on April 8, 2015 for providing loans from Rs. 50,000 to Rs. 10 Lakh to the non-cooperate, non-farm small micro enterprises. Under the PMMY, all the banks viz. Public sector banks, Private Sector banks, Regional Rural Banks (RRBs), State Co-operative banks, Urban Co-operative Banks, Foreign Banks, and Non-banking finance companies (NBFCs) / Micro finance institutions (MFIs) are required to lend to non-farm sector income generating activities below 10 lakhs. Initiated with the corpus of 20,000 crore from priority sector lending. Further, the budget supported the amount of 3000 crores for guaranteeing these loans.
The borrowers can approach any of the lending institutions from above list or can apply online through the government portal www.mudra.org.in. These loans (MUDRA LOANS) comes under PMMY. Pradhan Mantri Mudra Yojana is further divided in three products namely ‘Shishu’,‘Kishore’ and ‘Tarun’ to signify the stage of growth and funding needs of the beneficiary micro unit /entrepreneur and also provide a reference point for the next phase of graduation. Following are the details about PMMY Loan Scheme.
- Shishu- Covering loans up to 50,000 Rs.
- Kishore- Covering loans above 50,000 and above 5,00,000
- Tarun – Covering loans above 5,00,000 and up to 10,00,000
Mudra loan eligibility & other conditions:
Every Non-Corporate Small Business Segment (NCSBS) which includes proprietorship or partnership firms or running as small manufacturing units, service sector units, shopkeepers, fruits/vegetable vendors, truck operators, food-service units, repair shops, machine operators, small industries, food processors and others in rural and urban areas are eligible for assistance under Mudra. Bank will provide loans as per customer needs. Loans under this scheme are collateral free loans.
Mudra loans are available for the following.
- Vehicle loans: Commercial Vehicle loan, Two-wheeler and car loan
- Business Installment Loan (BIL): Loan for working capital requirement, buying plant and machinery, renovating offices etc.
- Business Loans Group Loans (BLG) & Rural Business Credit (RBC): for drop line overdraft and working capital loans.
Mudra Loan – HOW TO APPLY
Borrowers who need to avail assistance under PMMY can approach the local branch of any of the financial institutions in their regions. Eligibility norms of respective lending institution will further decide sanction assistance. An applicant should not be defaulter of any bank or Financial institution.
Documents Required for Pradhan Mantri Mudra Yojana
- Proof of identity: Self attested copy of Voter’s ID card / Driving licence / PAN card / Aadhar Card / Passports / or any other photo id issued by The Government.
- Proof of residence: Telephone bill / electricity bill / property tax receipt / Bank passbook etc.
- Quotation of machinery or other items yet to purchase.
- Name of supplier / details of machinery etc.
- Proof of identity / address of business enterprise etc.
- Proof of category i.e. SC/ST/OBC/ Minority etc.
One noticeable thing about PMMY is, loans are hassle free. As there is no processing fee and repayment period is up to 5 years, no collateral.
As per record on February 2018, the total amount sanctioned is 1,71,488* crores out of which 1,65,312 crores of amount is disbursed.
Eligibility and Other Conditions for Pradhan Mantri Mudra Yojana (PMMY)
The business unit must be one of the following.
- Small manufacturing units
- Fruits and vegetable vendors
Technically, all these loans come into the non-farm generating organizations in manufacturing, trading and service provision sectors.Amount up to/ less than 10 lakhs by the public-sector banks, Regional rural banks, state co-operative banks and Urban co-operative banks fall under the PMMY scheme and become what is known as MUDRA loans.
India, as a developing country, is helping their small entrepreneurs to grow and prosper. Considering the huge population and the associated poverty lines, it is not at all easy task to accomplish. To aid this, government is introducing Mudra Loan Scheme. A bigger part of the country is yet unemployable or struggling with their start-ups. With this type of schemes, the start-ups will get a boost in the form of micro finances. Shishu, Kishore and Tarun,all of these will ensure growth under ranging of micro finance and micro credits.