PM Mudra Yojana: Benefits, Documents and Application Process

Pradhan Mantri MUDRA Yojana (PMMY) is an initiative established by the Hon’ble Prime Minister on April 8, 2015, to provide loans up to 20 lakh to non-corporate, non-farm small/micro firms (for those entrepreneurs who have taken and successfully repaid earlier loans under the ‘Tarun’ category). MUDRA has developed four products: ‘Shishu’, ‘Kishore’, ‘Tarun’, and ‘TarunPlus’ to represent the stage of growth / development and finance requirements of the beneficiary micro unit / entrepreneur. Let’s learn more about the Pradhan Mantri Mudra Yojana Scheme.

What is Pradhan Mantri Mudra Yojana?

PMMY is the Government of India’s flagship project. The initiative offers microcredit/loans of up to Rs. 10 lakhs to income-generating micro companies in the non-farm sector, which includes manufacturing, commerce, and service industries, as well as agricultural operations such as poultry, dairy, and beekeeping. These micro and small entities include millions of sole proprietorship or partnership firms that work as small manufacturing units, service sector units, shopkeepers, fruit and vegetable vendors, truck operators, etc.

Pradhan Mantri Mudra Yojana: Benefits, Documents and Application Process

Pradhan Mantri Mudra Yojana Interest rate

Member Lending Institutions declare interest rates on a regular basis in accordance with the Reserve Bank of India standards, which are used to establish the appropriate interest rate. Mudra loans have interest rates that start at 9.30% per year, and loan repayment terms span from one to seven years.

Pradhan Mantri Mudra Yojana Processing Fee

Banks may contemplate imposing an upfront fee based on their internal criteria. Most banks remove the upfront fee/processing expenses for Shishu loans (up to Rs. 50,000).

Pradhan Mantri Mudra Yojana Benefits

The scheme is organized into three categories that is ‘SHISHU’, ‘KISHORE’, and ‘TARUN’, representing the level of growth / development and financial needs.

Shishu: Covers loans up to Rs.50,000/-.
Kishore: Covering loans from Rs.50,000/ to Rs. 5 lakhs.
Tarun: Covering loans beyond Rs. 5 lakhs and up to Rs. 10 lakhs.

Pradhan Mantri Mudra Yojana Eligibility

Borrowers can be individuals, sole proprietorships, partnership firms, private limited companies, public companies, or any other legal entity.
The applicant should not be a defaulter with any bank or financial institution.
Individual borrowers may be required to have the necessary skills, experience, or knowledge to carry out the requested task.
The nature of the intended activity and the requirements determine whether or not an educational certification is required.

Pradhan Mantri Mudra Yojana Documents Required –

For Shishu Loan

A self-attested copy of a voter’s ID card, driver’s license, PAN card, Aadhaar card, passport, etc.
Recent telephone bill / energy bill / / Voter’s ID Card / Aadhar Card, etc.
Two recent coloured photos
Quotation for machinery and other items to be acquired.
Business identity proof such as any licences or registration certificates etc.

For Kishore and Tarun Loan

A self-attested copy of a driver’s license, PAN card, Aadhar card, or passport, etc.
Electricity bill, a voter’s ID card, an Aadhar card, etc for an address proof.
Two recent coloured photos.
Business identity proof such as licenses/registration certificates, etc.
Last six months account statement
Last two years’ balance sheets of the units with income tax/sales tax returns, etc.
One year projected balance sheet.
Sales achieved throughout the current fiscal year until the date of application submission.

Pradhan Mantri Mudra Yojana Application Process –

Go to PM MUDRA’s official website
Select the Udyamimitra portal.
Click on the Mudra loan “Apply Now”
Choose among new , existing or self employed entrepreneurs.
Enter applicant’s details
Generate OTP
After Successful Registration
Enter required personal and professional details.
Click “Loan Application Center”
Choose the type of loan
Enter all required business details such as the name of the business, the type of business, etc.
Enter additional information such as owner details, existing banking/credit facilities,etc.
Attach documents such as ID proof, address proof, proof of address of the business enterprise, etc.
Once the application is submitted, an Application Number is generated, which must be maintained for future reference.

Disclaimer: The above information is for educational purposes and based on the latest research and development available. However, it may not fully reflect all the current aspects of the subject matter. Moneydaily.in advises readers to visit the NPCI’s website for further information.