PM Mudra Loan, also known as Pradhan Mantri Mudra Yojana, is an Indian government initiative launched in 2015. The scheme aims to provide financial assistance to micro and small enterprises, including individuals, partnerships, and small businesses, to support their business and entrepreneurial activities. “Mudra” stands for Micro Units Development and Refinance Agency.
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Under PM Mudra Loan, eligible individuals and businesses can avail loans up to a certain limit without collateral security. The scheme categorizes loans into three categories: Shishu, Kishor, and Tarun, based on the stage and size of the business. Shishu loans are for small enterprises in their early stages, Kishor loans for established businesses requiring expansion, and Tarun loans for larger businesses with higher credit requirements.
Pradhan Mantri Mudra Yojana provides financial support for various purposes such as starting a new business, expanding existing operations, purchasing machinery or equipment, working capital requirements, and other business-related needs. The loans are offered through various participating financial institutions such as banks, non-banking financial companies (NBFCs), microfinance institutions (MFIs), and rural banks.
The scheme aims to promote entrepreneurship, job creation, and financial inclusion by providing accessible and affordable credit to small businesses and individuals across the country. It plays a crucial role in empowering individuals, especially those from marginalized sections of society, to become self-employed and contribute to economic growth and development.
What is Modi Mudra loan?
There is no specific scheme called “Modi Mudra Loan.” However, it seems you are referring to the Pradhan Mantri Mudra Yojana (PM Mudra Yojana), which was launched by Prime Minister Narendra Modi in 2015. PM Mudra Yojana is a government initiative aimed at providing financial assistance to micro and small enterprises, including individuals, partnerships, and small businesses.
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Under PM Mudra Yojana, eligible borrowers can avail loans up to a certain limit without the need for collateral security. The scheme categorizes loans into three categories: Shishu, Kishor, and Tarun, depending on the stage and size of the business. Shishu loans are for small enterprises in their early stages, Kishor loans are for established businesses requiring expansion, and Tarun loans are for larger businesses with higher credit requirements.
Who are eligible for PM Mudra loan?
The eligibility criteria for availing a loan under the Pradhan Mantri Mudra Yojana (PM Mudra Loan) scheme are as follows:
Individuals and entities: The scheme is open to individuals, including vendors, artisans, farmers, shopkeepers, small business owners, professionals, and entrepreneurs. It also extends to entities such as partnerships, proprietary firms, limited liability partnerships (LLPs), private limited companies, and other non-corporate small business entities.
Business sector: PM Mudra Loan primarily targets activities in the non-farm sector, including manufacturing, trading, services, and allied activities.
Loan amount categories: The loans are categorized into three segments based on the stage and size of the business: Shishu (up to ₹50,000), Kishor (up to ₹5 lakh), and Tarun (up to ₹10 lakh). The eligibility criteria may vary depending on the loan category.
Loan purpose: The loans are intended for various purposes related to business activities, such as starting a new business, expanding an existing business, purchasing machinery or equipment, working capital needs, and other business-related requirements.
Existing relationship with the bank: In some cases, having an existing banking relationship or account with the lending institution might be preferred or required.
Is Mudra loan interest free?
No, Mudra loans are not interest-free. Mudra loans, provided under the Pradhan Mantri Mudra Yojana (PM Mudra Yojana) scheme, are regular loans offered by participating financial institutions such as banks, microfinance institutions (MFIs), and non-banking financial companies (NBFCs). The interest rates for Mudra loans are determined by the lending institution and are subject to the applicable policies and guidelines set by the Reserve Bank of India (RBI) and the respective lending institution. The interest rates for Mudra loans can vary based on factors such as the loan category (Shishu, Kishor, Tarun), the borrower’s creditworthiness, the loan amount, and the prevailing market conditions
What is PM MUDRA benefits?
The Pradhan Mantri Mudra Yojana (PM Mudra Yojana) offers several benefits to borrowers who avail loans under the scheme. Some of the key benefits include:
Access to Finance: PM Mudra Yojana aims to provide financial assistance to micro and small enterprises, including individuals, partnerships, and small businesses, who may otherwise face challenges in accessing credit from traditional sources. It enables borrowers to obtain loans for various business purposes, such as starting a new business, expanding existing operations, purchasing equipment, or meeting working capital needs.
Collateral-free Loans: One of the significant advantages of PM Mudra Yojana is that the loans provided under the scheme are collateral-free. Borrowers do not need to provide any security or collateral to avail of the loan, making it more accessible for individuals and small businesses who may not have significant assets or collateral to offer.
Competitive Interest Rates: While the interest rates for Mudra loans are determined by the lending institution, they are generally competitive and affordable, making it easier for borrowers to repay the loan amount.
Flexible Loan Categories: PM Mudra Yojana classifies loans into three categories: Shishu, Kishor, and Tarun, based on the stage and size of the business. This categorization allows borrowers to select the loan category that suits their specific requirements and borrowing capacity.
Financial Inclusion and Empowerment: PM Mudra Yojana promotes financial inclusion by providing financial support to individuals and small businesses, especially those from marginalized sections of society. It empowers borrowers to become self-employed, start their businesses, generate income, and contribute to economic growth and development.
Job Creation and Entrepreneurship: By facilitating access to finance and promoting entrepreneurship, PM Mudra Yojana aims to stimulate job creation, particularly in the micro and small enterprise sector. It encourages individuals to become job creators rather than job seekers, fostering economic growth and reducing unemployment.
How much amount can be taken in PM MUDRA loan?
The loan amount that can be availed under the Pradhan Mantri Mudra Yojana (PM Mudra Loan) scheme depends on the loan category and the borrower’s creditworthiness. PM Mudra Yojana categorizes loans into three segments:
Shishu: Under the Shishu category, borrowers can avail loans up to a maximum of ₹50,000. This category is intended for small businesses in their early stages or those requiring a smaller loan amount.
Kishor: The Kishor category allows borrowers to avail loans ranging from ₹50,001 to ₹5 lakh. This category targets established businesses that need funds for expansion, equipment purchase, or working capital requirements.
Tarun: The Tarun category enables borrowers to avail loans ranging from ₹5,00,001 to ₹10 lakh. This category caters to larger businesses with higher credit requirements.
What is Mudra loan interest rate?
the interest rates for Mudra loans provided under the Pradhan Mantri Mudra Yojana (PM Mudra Yojana) scheme are determined by the lending institutions, including banks, microfinance institutions (MFIs), and non-banking financial companies (NBFCs). The interest rates for Mudra loans can vary based on several factors, including the loan category, the borrower’s creditworthiness, the loan amount, and prevailing market conditions.
Is Mudra loan safe?
Yes, Mudra loans are generally considered safe for borrowers. The Pradhan Mantri Mudra Yojana (PM Mudra Yojana) is a government-backed scheme aimed at providing financial assistance to micro and small enterprises, individuals, and small businesses. The loans are offered by participating financial institutions, including banks, microfinance institutions (MFIs), and non-banking financial companies (NBFCs), which are regulated by the Reserve Bank of India (RBI) and other regulatory bodies.
What is the time period of Mudra loan?
The time period or repayment tenure of a Mudra loan depends on the specific loan category and the terms agreed upon between the borrower and the lending institution. Under the Pradhan Mantri Mudra Yojana (PM Mudra Yojana), which provides loans through participating financial institutions, the repayment tenure can vary.
Typically, the repayment tenure for Mudra loans can range from 3 to 5 years. However, the exact duration can be determined by factors such as the borrower’s creditworthiness, the loan amount, the purpose of the loan, and the policies of the lending institution.
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