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Mudra Loan for Women in India

Updated on November 18, 2024 , 143808 views

Mudra loan for women is one of the major initiatives by the Government of India. The purpose behind this scheme is to uplift the Micro, Small and Medium Enterprises (MSMEs) in India. Mudra loan was launched on 8th April 2015 to support small businesses across India.

The loan scheme aims at creating a smooth credit delivery and recovery system. It also encourages banks to use Good Credit recovery methods and create a healthier system.

What is Mudra Loan?

Micro-Units Development and Refinance Agency (MUDRA) loan is an initiative for the upliftment of the MSMEs. Mudra is an owned subsidiary of Small Industries Development Bank of India (SIDBI).

SIDBI is responsible for working towards developing and refinancing SME units. Mudra Loan scheme is under the Pradhan Mantri Mudra Yojana (PMMY) and it offers loan schemes in three categories- Shishu, Kishor and Tarun schemes.

An applicant doesn’t require Collateral security or third-party guarantor while applying for a Mudra loan. However, the criteria for application varies from one bank to another. Applicants will need to check with the desired bank and their application requirements before applying for the loan.

It is also important to note that not all banks offer Mudra loans. However, banks that fall under the eligibility criteria of the Pradhan Mantri Mudra Yojana (PMMY) from both private and public sectors along with regional-rural banks, scheduled urban co-operatives, state co-operatives, will offer the loan.

Latest News

The recent Aatmanirbhar Bharat Abhiyan (Self-reliant India Scheme) has brought in certain benefits for the Mudra loan Shishu category.

Mudra Loan Shishu category loan borrowers to get relief of Rs. 1500 crores.
Rs. 1500 crore interest subsidy for Mudra Shishu loan borrowers
Government has declared to give a discount of 2% on the interest for fast recipients for 12 months.

Mudra Loan Interest Rates 2024

The interest rates under the Mudra loan depends on the applicant’s profile and needs of the enterprise. However, it is also subject to the bank the applicant is applying to. The tenure for a loan under all the three categories is up to 5 years.

Here are the top 5 banks that provide Mudra Loan for Women. Check the interest rates for 2020 mentioned below:

Bank	Loan Amount (INR)	Interest Rate (%)
State Bank of India (SBI)	Rs. 10 lakhs	10.15% onwards
Bank of Baroda (BOB)	Rs. 10 lakhs	9.65% onwards+SP
Bank of Maharashtra	Rs. 10 lakhs	8.70% onwards
Andhra Bank	Rs. 10 lakhs	10.40% onwards
Corporation Bank	Rs. 10 lakhs	9.30% onwards

1. State Bank of India (SBI)

SBI provides a maximum loan amount of Rs. 10 lakhs. The repayment tenure is up to 5 years. The processing fees are nil for the Shishu loan scheme. The interest rate for all three categories starts from 10.15% onwards.

2. Bank of Baroda (BOB)

The Bank of Baroda offers a loan amount of Rs. 10 lakhs. The repayment tenure is up to 5 years. The processing fee is NIL for all three categories. The rate of interest starts from 9.65% onwards along with Strategic premium.

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3. Bank of Maharashtra

The Bank of Maharashtra provides a loan amount of Rs. 10 lakhs. The repayment tenure is up to 5 years. The processing fee depends on the applicant’s profile. The rate of interest starts from merely 8.70%.

4. Andhra Bank

The Andhra Bank provides a loan amount of Rs. 10 lakhs. The repayment period is up to 5 years. The processing fee has a 50% concession. The rate of interest starts at 10.40% onward.

5. Corporation Bank

The Corporation Bank offers a loan amount of Rs. 10 lakhs. It offers a repayment tenure of up to 7 years. The processing fee depends on the applicant’s profile. The rate of interest starts at 9.30% onward

Types of Mudra Loans

Three different categories of Mudra Loans are explained below:

1. Shishu Loan

Under this category, the applicant can apply for a loan of up to Rs. 50,000. This is targeted toward small start-ups. The applicant has to present their business idea while applying for this loan. This will decide whether they would be eligible for the loan sanction.

2. Kishor Loan

Under this category, the applicant can apply for a loan of Rs. 50,000 to Rs. 5 lakhs. This is targeted toward those with an established business, but wishes to set a strong base for it. The applicants are required to present all relevant documents to showcase the current position of their company.

3. Tarun Loan

Under this category, the applicant can apply for a loan of up to Rs. 10 lakhs. This targeted toward those with an established business, but are looking for expansion. The applicant will have to show related documents to get the loan approved.

Institutions Eligible for Mudra Loans

The following institutions are eligible for providing Mudra Loans:

Private sector banks
Public sector banks
Regional Rural Banks
State co-operative banks
Micro-finance institutions

Eligibility Criteria for Women

Following are the necessary criteria to be eligible for a Mudra loan:

1. Age Group

Applicants applying Mudra loan should be between the age group of 18 years and 65 years.

2. Occupation

Applicants should be any one of the following:

Shopkeepers
Small Industrialists
Manufacturers
Start-up owners
Business owners
Women involved in agricultural activities

Documents Required to Apply for Mudra Loan

The following documents are required while applying for Mudra loan-

1. Identity Proof

aadhaar card
PAN Card
Voter’s ID card
Passport
Driving license
Business license
Passport size photos

2. Address Proof

Aadhar Card
Telephone Bill
Voter’s ID card

3. Income Proof

Bank statement
Quotation of items for business purchase

Sectors Covered under Mudra Loan

Mudra loan is tailored for helping businesswomen, vendors, shopkeepers and others. The loan money should be directed toward the working Capital and purchase of equipment or transport facilities.

1. Food Sector

Women working with tiffin services, street-side food stalls, cold storage, catering services are eligible to apply for the loan.

2. Trading Sector

Women dealing with the handloom sector, fashion designing, khadi work and other textile work can apply for the loan.

3. Shopkeepers

Women working as shopkeepers and vendors are also eligible for applying for this scheme.

4. Agricultural Sector

Women dealing with dairy farming, livestock rearing, poultry farming, and other activities can also apply for this loan.

Mudra Card

Applicants can avail the Mudra card after loan approval. The bank opens a loan account for the applicant and the set amount is disbursed into the account. The applicant can then debit the amount through the Mudra Debit Card. This is helpful in keeping a track record of the applicant’s credit history.

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Conclusion

Read all the scheme related documents carefully from your desired bank before applying for the loan. Present all necessary documents and other bank requirements before applying.

Disclaimer:
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.