A Guide to Pradhan Mantri MUDRA Yojna Scheme (PMMY)

The government of India introduced Pradhan Mantri MUDRA Yojna to help small businesses in the country by lending them loans. These loans will help them cover their expenses and even operating costs. As per this scheme an individual can borrow a maximum amount of Rs. 10 lakh. Government of India has divided this scheme into three parts are as follows:

• Shishu

  A loan of up to Rs 50,000 can be granted to an individual.

• Kishor

  A loan of up to Rs 50,000 to Rs 5,00,000 can be granted to an individual.

• Tarun

  A loan of up to Rs 5,00,000 to Rs 10,00,000 can be granted to an individual.

Applying for this scheme/loan is easy. You just need to have all the documents in place. The list of mandatory documents are listed below:

• ID proof, Address Proof, and Business proof.
• Fill the Pradhan Mantri MUDRA Yojna application form. You can find one at a lender who is enrolled under the scheme.
• Submit all the essential documents you have been asked.

Eligibility Criteria for MUDRA Yojna Scheme

As mentioned above, this loan is for small businesses, keeping that in mind every Indian Citizen can avail of this loan. Citizens can apply for loans of up to Rs 10,00,000 from Public, Private, Regional, Small Finance banks, and from NBFCs. This loan can be available by individuals who are planning to do the following:

• An individual can avail the loan for Artisans purposes
• Small scale Manufacturers can avail this loan
• Individuals with small shops can avail this loan
• Grocery, Vegetables, and even fruits sellers can avail this loan
• Individuals who planning or already engaged with agricultural activities can avail this offer

Banks offering Interest Rate for MUDRA Yojna scheme

There are many private as well as public banks that offer MUDRA Yojna loans. Some of them are listed below with their Interest Rate and Tenure:

• State Bank of India (SBI)

  They offer a rate of interest of about 11.25% with a tenure period of up to 5 years.

• Syndicate Bank

  The Bank offers a rate of interest of about 8.60% to 9.85% with tenure period based on the terms of the bank.

• Bank of India (BOI)

  They offer a rate of interest starting from 10.70% with a tenure period of 3 years to 7 years.

• Andhra Bank

  The bank offers a rate of interest of about 8.40% to 10.35% with tenure period starting from 3 years.

• Tamilnad Mercantile Bank

  It offers an interest rate of 9.90% to 12.45% with a tenure period of up to 7 years.

List of Documents required for PM Mudra Yojna

Documents required are depended upon the type of loan you opt for, basically, there are a few types of loansVehicle loan, Business Installment Loan and Business loans Group and Rural Business credit loan. Mandatory documents for the each loan is mentioned below.

Vehicle Loan

• Pradhan Mantri MUDRA yojana application form.
• Loan Application form.
• Income proof and 2 passport size colour photographs
• Address proof.
• Bank statements going back up to 6 months.

Business Installment Loan

• A filled MUDRA scheme application form.
• Address proof.
• Last2 years of Income Tax Returns.
• You will need to provide bank statements going back up to 6 months
• You will need to provide Qualification proof.
• You will need to provide Establishment proof.
• You will need to provide Ownership proof of residence or office.

Business Loan Group and Rural Business Credit

• MUDRA scheme application form.
• BIL application form
• income tax Returns of 2 years.
• Address proof and age proof.
• Bank statements going back up to 12 months.
• Ownership proof of Office or residence.

Activities Covered under MUDRA Scheme Loan

• Activities like community, social and personal Service. Under this category shops, salons, gyms, dry cleaning, beauty parlours, and similar businesses can avail this offer.

• Activities like transport, you can buy a transport vehicle for your business use. You could buy auto-rickshaws, three-wheelers, passenger cars, etc.

• You can avail of Mudra Loan for food product sector activities. You could be in activities like papad making, catering, small food stalls, ice cream making, etc.

• You can avail of MUDRA loan for textile products activities. These types of activities include handlooms, power looms, khadi activity, knitting, traditional printing, etc.

• This loan can also be availed for agricultural activities. It includes beekeeping, livestock, pisciculture, etc.

Benefits of Pradhan Mantri MUDRA Yojana Scheme:

• This loan can be availed in both rural as well as urban areas.
• You can financially back-up your small-scale business and start-ups.
• Small vendor shops can use this scheme as it helps them the most.
• The tenure period of this scheme can be extended for up to 7 years.
• This loan can be availed by women for a discounted rate of interest.
• No security required to avail this loan.