MUDRA Loan

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MUDRA Loan

What is MUDRA Loan?

Micro-Units Development and Refinance Agency (MUDRA) is the initiation of the Indian government to help the Indian citizens by providing them Loans of at least Rs. 50,000 and up to Rs. 10 lakh to start-up companies and small business. There is no need for collateral or guarantor to avail this loan for availing this you must be meet eligible criteria made by the government.

Types of mudra loan:-

There are three types of mudra loan

Shishu:- This mudra loan is specially designed for the new or small business owner. In this loan, you can avail a loan up to 50,000.  Before applying for this loan you must prepare a business idea to get approval.

Necessary details required:

  • Quote of equipment and various stuff to accomplish.
  • Details of the hardware which is needed to be bought
  • Machinery supplier information also needs to be provided by borrowers.

Kishor:- This mudra loan is designed for those who have already started a business but they need a loan for the development of the business. In this loan, you can avail above 5 lakh and up to 5 lakh.

Necessary details required:

  • The last six months of a present banker’s record declaration
  • Balance sheet for the last two years
  • Income/sales tax returns.
  • Estimated one-year accounting report of the loan period.
  • Memorandum and articles of association
  • Sales made before documenting the loan application and in the current FY.

Tarun:- This loan is for those have started and built a business but they need money for the extension of the business. In this, you can a loan up to 10 lakh.

Necessary details required:

  • The last six months of a present banker’s record declaration
  • Balance sheet for the most recent 2 years
  • Income/sales tax returns.
  • Estimated accounting report for 1 year or for the span of the loan.
  • Memorandum and articles of association
  • Details of sales made before applying for the loan application and in the current FY.

Eligible criteria for applying for mudra loan:-

There are some eligible criteria for applying mudra loan

  • This loan can be availed by the one who wants to establish business or shopkeeper.
  • Who have small Industries and Manufacture company
  • Who is involved with Agricultural activities
  • Who already owned a business but need money for the extension of the business.

Documents required for Pradhan Mantri mudra loan(PMMY Loan) yojana:-

  • Identity proof:- Aadhar card/ voter id /passport/ driving license (anyone)
  • Residential proof:- utility bill/ Aadhar card/ voter id /passport (anyone)
  • Identity proof, address, company licenses (if any)
  • Two passport size photographs.

How to apply for mudra loan:-

  • Go to the online mudra loan website mudra.org.in and download the mudra loan form.
  • Fill the mudra loan application form with the required details
  • Go the nearest branch of the bank which comes under the Pradhan Mantri mudra yojana (PMMY) loan scheme
  • Submit the form to the bank with the required documents.

Benefits of Mudra loan:-

  • There is no minimum limit of the loan amount
  • There is no requirement of collateral or guarantor to avail this loan.
  • There is no processing fee for the loan
  • This loan can be availed by all non-farm businesses
  • This loan be availed in both rural and urban area
  • Through this scheme, women borrower can get a discount on interest rate
  • The MUDRA loan scheme is collaborated with the government’s “Make In India” campaign to promote innovation, promote investment, enhance skill growth, and create the country’s finest manufacturing infrastructure.

Features of the Pradhan Mantri Mudra Yojana (PMMY) Scheme

  • This loan can be availed as a term loan or as a working capital loan.
  • There are three sub-categories of the Pradhan Mantri Mudra Yojana – Shishu, Kishore, and Tarun. The loan category decided by the loan amount.
  • A margin of 10 percent applies to the loan amount between Rs.50,001 and Rs.10 lakh. The borrower will, therefore, have to finance 10 percent of the amount of the loan chosen.
  • No collateral is required to avail this loan.

Mudra card:-

Mudra card is a debit card given to candidates who want to apply for a loan from Mudra. When a person applies for mudra loan and gets approved then the banks open the mudra loan account and issued them a mudra card. The loan amount is deposited to the Mudra account so that the borrower can debit the loan amount from their Mudra account. This process also helps the borrower to develop a good credit history.

Mudra loan interest rate comparison:-

Banks

Interest rate

State Bank of India (SBI)

11.25%

Bank of India

10.70% onwards

Syndicate Bank

8.60% – 9.85%

HDFC Bank

10.99% to 20.70%

Oriental Bank of Commerce (OBC)

10.65% to 11.65%

Andhra Bank

8.40% to 10.35%

ICICI Bank

10.99% to 17.99%

What type of loan can be availed under Pradhan Mantri loan yojana?

  • Car loan
  • Two-wheeler loan
  • Working capital loan
  • Revamping the business space
  • Commercial vehicle loan
  • Loan for plant and machinery

List of banks which comes under the pradhan mantri mudra yojana:-

  • UCO Bank
  • State Bank of India (SBI)
  • Canara Bank
  • Bank of India
  • Syndicate Bank
  • Indian Bank
  • Punjab National Bank (PNB)
  • Bank of Baroda
  • Central Bank of India (CBI)
  • Allahabad Bank
  • HDFC Bank
  • IndusInd Bank
  • Axis Bank
  • ICICI Bank
  • Ratnakar Bank
  • Yes Bank
  • Karnataka Bank
  • Karur Vysya Bank
  • South Indian Bank
  • Lakshmi Vilas Bank
  • Uttar Bihar Gramin Bank
  • Pragathi Krishna Gramin Bank
  • Karnataka Vikas Grameena Bank
  • Kerala Gramin Bank
  • Madhya Bihar Gramin Bank
  • Baroda UP Gramin Bank
  • Baroda Rajasthan Ksethriya Gramin Bank
  • Andhra Pragathi Gramin Bank
  • Pallavan Grama Bank
  • Allahabad UP Gramin Bank
  • ICICI Mudra Loan
  • Bank of Baroda (BOB)
  • IDBI
  • IOB
  • Andhra Bank
  • Union Bank of India (UBI)

Things to Keep in Mind

  • This scheme offers you Rs 50,000 to Rs 10 lakh loan amount.
  • Interest rates are convenient and acceptable, 8.40 and 12.45%.
  • There may be a processing fee but most lenders wave off the processing fee for the Shishu category.
  • Your tenure will depend on your income and recourses. However, some lenders can give you 5 years tenure for the loan.

Why You Should Apply for the Pradhan Mantri Mudra Yojana Scheme?

The Pradhan Mantri Mudra Yojana system is the best option for people who need fund to finance their business-related needs. There are some reasons for applying for the Pradhan Mantri Mudra Yojana system are listed below:

Through the PMMY scheme, small enterprises in the country can access in the best way to the funds, so the pm mudra yojana is the best option for business purpose.

Under the PMMY scheme, individuals who need resources for company expenses can take advantage of this loan at an efficient interest rate.

The PMMY system supports jobs development and GDP development.

The Pradhan Mantri Mudra Yojana processing fee is very low. A zero processing fee is charged for the Kishore and Shishu schemes, while a nominal interest of 0.50 percent plus tax is charged for the Tarun scheme.

MUDRA Loan Repayment Period

Candidates will receive the credit amount for a 5-year period and the applicant can repay the loan amount in the bank’s EMIs during those years. The candidates do not feel difficult to pay the loan amount in EMI because the financing costs are very small

The Motivation Behind MUDRA Loan

Mudra loan is stretched out for an assortment of purposes which result in business creation. The credits are expanded fundamentally for:

  • Business loan for other Service Sector activities
  • A working capital loan through MUDRA Cards
  • Gear Finance for Micro Units
  • Transport Vehicle loans – for business utilize as it were
  • Loans for agri-united non-agricultural salary producing activities, for example, pisciculture, honey beekeeping, poultry cultivating, and so forth.
  • Tractors, tillers just as bikes utilized for business purposes as it were..
  • Along these lines, a MUDRA loan empowers them together to develop and build up their business without adding much pressure and bother to their day by day schedule and funds.

1) Transport Vehicle

This loan can be used for purchasing of vehicles, auto-rickshaws, little merchandise transport vehicles, 3 wheelers, e-rickshaws, taxis etc. Tractors Trolleys/Power Tillers utilized distinctly for business objects are additionally qualified for help under PMMY. The bikes which is being used for business purpose can be included under PMMY scheme.

2) Community, Social and Personal Service Activities

Salons, magnificence parlours, recreation centre, boutiques, fitting shops, cleaning, cycle, and cruiser fix shops, DTP and Photocopying Facilities, Medicine Shops, Courier Agents, and so forth can be included.

3) Food Products Sector

Activities, for example, papad making, achaar making, jam/jam making, farming produce conservation at provincial level, sweet shops, little administration sustenance slows down and everyday providing food/bottle administrations, cold chain vehicles, cold stockpiles, ice-making units, frozen yogurt making units, scones, bread and bun making, and so forth.

4) Textile Products Sector/Activity

Handloom, power loom, khadi action, chikan work, zari and zardozi work, customary weaving and handwork, conventional coloring and printing, attire configuration, sewing, cotton ginning, electronic weaving, sewing and other material on piece of clothing items, for example, sacks, vehicle frill, outfitting extras, and so on.

5) Business Credits for Traders and Shopkeepers

Financial help loaning to people for running their shops/exchanging and business activities/administration undertakings and non-agricultural salary producing activities with a recipient loan size of up to 10 lakh for every venture/borrower.

6) Equipment Finance Scheme for Micro Units

Help for setting up minor undertakings by purchasing important machinery/types of gear with per recipient loan size of up to 10 lakh.

7) Activities United to Agribusiness

‘Activities united to agribusiness’, for example pisciculture, honey beekeeping, poultry, domesticated animals raising, evaluating, arranging, conglomeration agro ventures, journal, fishery, agri-facilities and agribusiness focuses, sustenance and agro-preparing, etc.(excluding yield loans, land improvement, for example, waterway, water system, and wells) and administrations supporting these, which loan occupation or are pay creating will be qualified for inclusion under PMMY in 2016-17.

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