How to Apply/Enroll Get Mudra Loan (Pradhan Mantri Mudra Yojana)
Pradhan Mantri MUDRA Yojana popularised under the name of Micro Units Development and Refinance Agency was announced by the Hon’ble Finance Minister during the Budget for FY 2016. This Yojana was organised by our Prime Minister Narendra Modi on 8th of April 2015 for funding small business sectors (small and medium scale entrepreneurs). “Funding the Unfunded” was the basic idea of this scheme established with a budget of Rs. 20,000 crores for extending credit up to Rs. 10 lakhs to Micro Finance Institutions. It is regarded to provide Rs. 10 Lakhs to Rs. 5.75 crore small business units.
With a prospect of accelerating the growth of Indian economy, this Yojana has been set up with the following benefits:
- Low-cost funds available for Micro Finance Institutes (MFIs), especially SCs/STs for lending.
- Small scale businesses will experience the ease of access to funds and will increase their liquidity.
- The combination of their integrity and capital would prove to be a successful duo for the success of this scheme.
- Similarity in regulations and best practices of SHG linkage programme, NBFCs-MFIs, trusts/societies/companies under section 25 engaging in Mudra activities as Mudra Bank will be the only regulator of all roles in the MFIs sector.
How to Apply Mudra Loan?
- Mudra loans can be availed by the eligible people from any of these lending financial bodies, Commercial banks (Private & Public), RRB’s (Regional rural banks), Co-Operative banks (Urban and State), and other Micro Financial Institutions.
- PMMY (Pradhan Mantri MUDRA Yojana) eligible borrowers can approach any of the above mentioned financial institutes, however, each institutions has their own eligibility norms, apart from that no other structural mode of applying process entertained for availing MUDRA loans.
- You should have a business plan with you.
- Take this business plan with any of these banks of org supporting Mudra loan.
- Present your case in front of bank. They will ask you to fill some forms. Since this is a collateral free loan no guarantor is needed.
- Since Government is more keep on giving loan to a women so make sure any female member is included in the business plan.
- Since, MUDRA loans are offered for the improvement of business owning a current account with the respective bank would make the loan process pretty simple and quicker.
- In order to assists the borrowers, the government of India has placed around 97 Nodal officers by appointing them at various SIDBI offices across the nation.
Documents need for applying MUDRA Loans
- As the mission of MUDRA loans is to achieve success in the entrepreneurial field by lending financial assistance with security, the eligible borrowers are required to approach banks by taking the completed business idea with them.
- In addition to that business documents, the loan application form must be enclosed with the basic proofs like applicant Photographs, copy of Identity proof, Copy of address Proof and if the borrower has Aadhaar card then submitting that copy is highly appreciated.
Complaints and Clarification.
The Yojana further provides three categories in which your business will lie. The three categories are
These three categories signify the growth, development and funding stages of the business of micro unit. Details regarding each stage are given as follows:
- First category SHISHU, offers a loan cover up to Rs. 50,000/-. This is for the stage when you have just started the business.
- The second category KISHOR, under which loan is covering up to Rs. 50,000 to Rs. 5 Lakhs will be provided by the time your business, has established itself.
- Third category TARUN, Rs. 10 Lakhs as a loan are provided when you have an established business and need the funds only for the appraisal and expansion of your business.
Now who to approach with this scheme is the main question. So for this problem one can seek help from any of the following institutions of their respective region:
- Scheduled Commercial Banks (Public/Private)
- Regional Rural Banks (RRBs)
- Scheduled Urban Co-operative Banks
- State Co-operative Banks
- Micro Financial Institutions- MFIs (like BNFCs, Societies, Trusts, )
The important thing to be kept in mind is that sometimes this MUDRA YOJANA is also called as MUDRA BANK but it is not to be mistaken as a separate bank. Mudra Bank is just a financial scheme under the Government of India to provide a loan for setting up a firm business to the small business sectors. This helps in the growth of the of small scale industries, catering the raw material needs of the large-scale industries, thus forming a circle for the expansion of large-scale industries too. All you need is get the blueprint of the business plan that is beneficial for the economy as a whole and choose the category accordingly. Just after doing this, approach the nearest public/ private bank.
Now once the loan has been granted, you will be given a MUDRA CARD, which is similar to the credit card. The limit of your Mudra Card will be 10% of the loan you have been granted. Suppose you have been
granted the loan of Rs. 10 Lakhs, then the credit limit will be Rs. 10,000. As it is, the maximum credit limit is Rs. 10,000. There’s a new update that CORPORATION BANK has launched a Mudra Card (in association with the Government of India) in the face of RUPAY DEBIT CARD. This card, all in all, extends a helping hand in the withdrawal of money along with the use of working capital finance by micro-entrepreneurs.