Mudra Yojana is a loan scheme initiated by Government of India to offers loan amount up to Rs. 10 lakh for individuals and MSMEs to start their new business or for existing businesses, without demanding any collateral or security.

What is MUDRA Yojana?
Micro Units Development and Refinance Agency (which is MUDRA full form) Loan scheme under PMMY or Pradhan Mantri Mudra Yojana is an initiative by Government of India that offers loans to individuals, SMEs and MSMEs. Launched in 2015 and announced by Prime Minister Narendra Modi, MUDRA Yojana is offered under 3 loan schemes named as Shishu, Kishor, and Tarun. The maximum loan amount offered under MUDRA scheme is up to Rs. 10 lakh, whereas there is no minimum loan amount criteria. No collateral or security is required by banks or financial institutions to avail Mudra loan. The repayment tenure of Mudra loan ranges from 3 years to 5 years with flexible EMI options.
No Collateral Required

What is MUDRA Yojana?
Micro Units Development and Refinance Agency (which is MUDRA full form) Loan scheme under PMMY or Pradhan Mantri Mudra Yojana is an initiative by Government of India that offers loans to individuals, SMEs and MSMEs. Launched in 2015 and announced by Prime Minister Narendra Modi, MUDRA Yojana is offered under 3 loan schemes named as Shishu, Kishor, and Tarun. The maximum loan amount offered under MUDRA scheme is up to Rs. 10 lakh, whereas there is no minimum loan amount criteria. No collateral or security is required by banks or financial institutions to avail Mudra loan. The repayment tenure of Mudra loan ranges from 3 years to 5 years with flexible EMI options.

Benefits of Mudra Loan

• Mudra loans are majorly offered to shopkeepers, traders, vendors, and MSMEs engaged in manufacturing, trading and service sector activities
• Mudra scheme is are covered under Credit Guarantee Schemes from Govt. of India
• Availed loan amount can also be used as term loans and overdraft facilities
• All Non-farm enterprises, i.e. small or micro firms engaged in the income generating activities can avail Mudra loan
• Mudra loan can also be availed by people belonging to SC/ST category at concessional interest rates.
• Mudra scheme can be availed via Mudra cards, as well

Mudra Loan Details
Products offered under Mudra Loan

Products offered under Pradhan Mantri Loan Yojana are classified under 3 loan schemes named as Shishu, Kishor and Tarun. Below mentioned is the loan amount offered under each loan scheme:

• SHISHU Loan: Loans up to Rs. 50,000 (For start-ups and new businesses) can be availed in Mudra Shishu Loan scheme
• KISHOR Loan: Loans from Rs. 50,001 to Rs. 5,00,000 (For buying equipment/machinery, raw materials, business expansion for existing enterprises) are available in Kishor Loan Scheme
• TARUN Loan: Loans from Rs. 500,001 to Rs. 10,00,000 (For established businesses and enterprises) under Tarun Loan Scheme

Purpose of Mudra scheme under PMMY
List of businesses that are covered under Mudra scheme to perform income generating activities are mentioned below.

• Commercial Vehicle: Mudra finance for machinery and equipment can be used to purchase of commercial transport vehicles like tractors, auto-rickshaws, taxis, trollies, tillers, goods transports vehicles, 3-wheelers, e-rickshaws, etc.
• Service Sector Activities: Starting businesses of salons, gyms, tailoring shops, medical shops, repair shops, and dry cleaning and photocopying shops, etc.
• Food and Textile Product Sector Activities: Various activities involved in respective sector
• Business activities for Traders and Shopkeepers: Setting up shops, service enterprises, trading and business activities and non-farm income generating activities
• Equipment Finance Scheme for Micro Units: Maximum loan up to Rs. 10 lakh
• Agri-allied Activities: Activities related to businesses in agri-clinics and agribusiness centres, food & agro-processing units, poultry farming, pisciculture, bee keeping, sorting, livestock-rearing, grading, aggregation agro industries, diary, fishery, etc.