The Government of India (GOI) introduced the Pradhan Mantri Mudra Yojana (PMMY) on April 8, 2015, through Micro Units Development & Refinance Agency Ltd (MUDRA), a subsidiary of Small Industries Development Bank of India (SIDBI).
The main objective of the PM Mudra Yojana scheme is to provide financial support to help micro and small enterprises expand their business. As per the government scheme, any profit and non-profit organisations can avail a loan amount of up to INR 10 Lakhs from any lending institutions registered with MUDRA.
Currently, 203 lending institutions are shortlisted to provide Mudra loans, among which are 15 cooperative banks, 25 microfinance institutions, 35 NBFCs, 47 NBFC-MFI, 18 private sector banks, 21 public sector banks, 36 RRBs and six small finance banks.
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Types of Lending Institutions Registered with PM Mudra Yojna
- Commercial Banks (both public and private sector)
- Railway Recruitment Board (RRBs)
- Micro Finance Institution (MFIs)
- Non-Banking Financial Corporations (NBFCs)
- Small Finance Banks
Types of Businesses that can apply Loan Under PMMY
- Shopkeepers
- Vendors
- Truck Owners
- Artisans
- Horticulture
- Fisheries
- Small Scale Manufacturer
- Self-employed Entrepreneur
- Food Production
- Service Sector
- Restoration and Repair Shops
Types of Loans Under PMMY
There are three types of Mudra loans based on the loan amount.
| Mudra Loan Types | Loan Amount |
| Shishu | Up to INR 50,000 |
| Kishor | INR 50,001 to INR 5,00,000 |
| Tarun | INR 5,00,001 to INR 10,00,000 |
What are the Benefits of Pradhan Mantri Mudra Yojana Loans?
Here are some of the Mudra loan benefits mentioned below:
- No minimum loan amount
- Maximum loan amount of INR 10 Lakh
- No processing charges
- No collateral needed
- The government gives the credit guarantee, and thus, if the borrower defaults from paying the loan amount, the loss is borne by the government.
- The interest on Mudra loans is based on the Marginal Cost of Lending Rate (MCLR) and calculated according to the guidelines by the Reserve Bank of India.
- The loan repayment period depends upon the lending institution. However, the repayment period can be extended up to 5 years.
- Under the Mudra Shishu loans, the lending institution will provide a relief of up to INR 1,500 crore and an interest subsidy of INR 1,500 crore to the borrowers.
- Mudra scheme is collaborated with ‘Make in India’ scheme.
PM Mudra Loan Eligibility Criteria
The Mudra loan can be availed by micro and small enterprises involved in manufacturing, selling or service sectors. It is not only provided to the non-farm industries but also those who are engaged in horticulture and fisheries. Having said that, let’s now see the Mudra loan eligibility criteria.
| Particulars | Eligibility Criteria |
| Minimum age required to avail Mudra loan | 18 years |
| Maximum age allowed to avail Mudra loan | 65 years |
| Security or collateral | Not required |
| Sector and activities included | All non-farm enterprises and allied agriculture activities |
| Credit needs | Maximum INR 10 Lakh |
Documents Required to Apply for PM Mudra Loan
Mentioned below is the list of documents needed to apply for Pradhan Mantri Mudra Yojana loans.
| Mudra Loan Documents Required | Acceptable Supporting Documents |
| Application Form | Shishu, Kishor or Tarun |
| Identity Proof | Aadhaar card, Voter’s ID card, Driving license, Passport, PAN card, etc |
| Address Proof | Electricity bill, Telephone bill, Aadhaar card, Voter’s ID card, Passport, etc |
| Photographs | 2 passport-sized photographs |
| Caste Certificate | If applicable |
| Others | Bank Passbook or latest bank statement |
PM Mudra Loan Bank List
The table shows the private and public sector banks that provide Mudra loans.
| Allahabad Bank | Andhra Bank | Axis Bank | Bank of Baroda |
| Bank of India | Bank of Maharashtra | Canara Bank | Central Bank of India |
| Corporation Bank | Dena Bank | Federal Bank | HDFC Bank |
| IDBI Bank | ICICI Bank | Indian Bank | Indian Overseas Bank |
| J&K Bank | Karnataka Bank | Kotak Mahindra Bank | Oriental Bank of Commerce |
| Punjab National Bank | Punjab and Sind Bank | Saraswat Bank | State Bank of India |
| Syndicate Bank | Tamilnad Mercantile Bank | UCO Bank | Union Bank of India |
| United Bank of India |
How to Apply for PM Mudra Loan?
Follow the step-by-step guide to applying for the Mudra loan.
- Decide the loan amount required for your business, and based on that, find out which loan options would be beneficial to you among Shishu, Kishor, and Tarun.
- Make sure you have all the documents required to apply for the Mudra loan.
- Visit any lending institution that offers Mudra loans and request the loan application form. Or, you can download it online from the official website of Mudra.
- Follow the following steps.
1. Fill up the form with all the relevant information.
2. Attach all the required documents.
3. Attach your photograph.
4. Sign the form wherever required.
If you are unsure how to fill-up the form, do not hesitate to ask the banking officer for help. - Submit the form to the banking officer and collect the receipt.
- Wait until any further communication from the lending institution about the sanctioned loan.
After applying for the loan successfully, the lending institution opens a Mudra loan account, and a Mudra card is also issued. A Mudra card is a debit card with which you can make multiple withdrawals of the loan amount and even use it to make payments through Point of Sale (POS).
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Frequently Asked Questions
The Mudra loan interest rate depends upon the lending institution you are applying for your loan. As stated above, the interest on Mudra loans is calculated based on guidelines provided by RBI and is determined by MCLR.
An e-Mudra loan is provided by the State Bank of India (SBI) to its existing customers having savings or current accounts with the bank. Under the SBI e-Mudra scheme, you can avail of a loan for an amount of INR 1,00,000 by visiting the SBI e-Mudra portal.
Yes. To encourage women entrepreneurs, the Government of India (GoI), under the Mudra scheme, provides a total rebate of 25 Basis Points (BPS) in the interest rates offered from NBFCs and MFIs.
