The PMMY scheme launched in 2015 aims to provide MUDRA Loans to small and micro enterprises through various commercial banks, RRBs, SFBs, NBFCs, and Cooperative Banks.
The loan range may vary depending on growth, development, and funding needs. The MUDRA loan can be categorized into
- Sishu - Up to Rs. 50,000
- Kishore - Rs. 50,000 to 5 Lakh
- Tarun - Rs. 5 Lakh to 10 Lakh
Table of Contents
Eligibility
- Must have business plans for service sector activities or trading or manufacturing activities.
- In the case of an individual applicant, the age range must be between 18 and 65 years.
- Must be a non-corporate and non-farm small and micro-enterprise.
Documents Required for the PMMY Scheme
- Proof of identity
Self-attested copy of Voter's ID card/Driving Licence/PAN Card/AadhaarCard/Passport/Photo IDs issued by Govt. authority etc. - Proof of Residence
Recent telephone bill/electricity bill/property tax receipt (not older than 2 months) / Voter's ID card / Aadhaar Card / Passport of Individual / Proprietor/Partners/Bank passbook or latest account statement duly attested by Bank officials/Domicile certificate/certificate issued by Govt. authority/Local panchayat/Municipality etc. - Applicant's Recent Photograph (2 copies) 6 months or older.
- Proof of Identity/Address of the Business
Copies of relevant licenses/registration certificates/other documents pertaining to the ownership, identity, and address of the business unit, if any
Other relevant documents, like proof of category, quotation, etc., are also required during the application process.
Application procedure
If you are eligible, applying for a MUDRA loan is relatively easy and can be done both online & offline.
Online
- Visit the official website of the PMMY-authorized financial institution from which you wish to avail of the Mudra loan.
- Download the relevant form depending on the type of loan (Sishu, Kishore, and Tarun).
- Fill out all the personal and business details and then “Submit” the form.
- Once received, the application form is verified and processed accordingly. Following the verification, the loan amount is approved and disbursed.
- The loan amount can be withdrawn with the help of a MUDRA card issued after the loan approval.
Offline
- Visit a PMMY-authorized bank or NBFC of your choice.
- Fill out the MUDRA loan application form with the required details.
- Submit the application form with a self-written business plan and other documents to substantiate those details.
- After successful document verification, the loan will get approved, and the desired amount will be credited.
- Must have the required infrastructure and targeted acceleration programs.
Benefits of the PMMY Scheme
- MUDRA loans can be taken for small amounts at affordable interest rates; also, the credit guarantee is borne by the Government.
- This scheme could be availed without any collateral or security.
- The Mudra loan scheme in collaboration with the “Make In India” campaign, helps in fostering innovation, facilitating investment, and improving skill development.
- Women Borrowers can avail this scheme with discounted interest rates.
- Relief of up to 1500 Crore will be provided to the Borrowers as Interest Subsidy under the Mudra Shishu Category.
Achievements Under PMMY Scheme
Here’s a table to highlight the achievements under the PMMY scheme in the last 3 years.
Frequently Asked Questions
Private Limited Company
(Pvt. Ltd.)
- Service-based businesses
- Businesses looking to issue shares
- Businesses seeking investment through equity-based funding
Limited Liability Partnership
(LLP)
- Professional services
- Firms seeking any capital contribution from Partners
- Firms sharing resources with limited liability
One Person Company
(OPC)
- Freelancers, Small-scale businesses
- Businesses looking for minimal compliance
- Businesses looking for single-ownership
Private Limited Company
(Pvt. Ltd.)
- Service-based businesses
- Businesses looking to issue shares
- Businesses seeking investment through equity-based funding
One Person Company
(OPC)
- Freelancers, Small-scale businesses
- Businesses looking for minimal compliance
- Businesses looking for single-ownership
Private Limited Company
(Pvt. Ltd.)
- Service-based businesses
- Businesses looking to issue shares
- Businesses seeking investment through equity-based funding
Limited Liability Partnership
(LLP)
- Professional services
- Firms seeking any capital contribution from Partners
- Firms sharing resources with limited liability
Frequently Asked Questions
Who is eligible to apply for the PMMY Scheme?
Individuals, including entrepreneurs, micro-enterprises, and small businesses in the non-corporate, non-farm sector, are eligible to apply for loans under the PMMY Scheme.
Is there any collateral required for loans under the PMMY Scheme?
Loans under the PMMY Scheme are collateral-free, meaning borrowers do not need to provide any security or collateral to avail of the loans, making them accessible to a wider segment of the population.
Can existing businesses apply for loans under the PMMY Scheme, or is it only for new startups?
The PMMY Scheme is open to both existing businesses and new startups. As long as the business falls under the micro-enterprise or small business category and meets the eligibility criteria, it can apply for a loan under the scheme.
What is the role of the Micro Units Development and Refinance Agency (MUDRA) in implementing the PMMY Scheme?
The Micro Units Development and Refinance Agency (MUDRA) acts as the nodal agency for the implementation of the PMMY Scheme. It works in collaboration with various financial institutions to ensure the effective disbursal of loans and monitoring of the scheme's progress.
