To meet the financial needs of small and medium enterprises (Small Business / MSME) in the country, the Government of India has introduced Prime Minister Mudra Scheme (PMMY) in April 2015.
If a person wants to start their own business or want to pursue their current business, then they usually apply for a loan from the bank. But the process of taking loans from the bank is very complicated and it is a guarantee That is why most people take loans from banks.
Keeping this in mind, the Government of India has launched Mudra (Micro Units Development Refinance Agency) Scheme to promote small scale industries.
Benefits of Mudra Scheme
- Under the Mudra Scheme, loans are usually provided without guarantee.
- No processing fees are charged for providing loans under the Mudra Scheme.
- Repayment Period of currency loan can be extended up to 5 years.
- Working Capital Loan will be provided by Mudra Card.
Who are Eligible to Apply Loan Under Mudra Scheme?
Any Indian citizen or firm who wants to start his business in any field (other than agriculture) or want to move forward his current business and financial needs (financial needs) up to Rs 10 lakh, the Prime Minister Apply for a loan under the Mudra Loan Scheme.
Types of Loan Under Mudra Scheme
There are three types of loans under the Mudra Scheme
- Shishu Loan: Loan up to Rs. 50,000 / – under Shishu Loan is given.
- Kishor Loan: Loan up to Rs. 50,000 / – and upto Rs. 5 lakhs are given under Kishore Loan.
- Tarun Loan: Under Tarun Debt, loans up to Rs 5 lakh and up to Rs 10 lakh are given.
Under the Mudra Scheme , at least 60% of the loan will be given in the form of infant loans.
Interest Rates of Mudra Bank Loan – Interest Rate
Under the Mudra Loan, there are no fixed interest rates. Interest rates can vary between different banks and bank interest rates can vary depending on the risk of the applicant’s business. Usually Mudra Loan Interest rates of 12% are around every year.
Under the Mudra Loan Scheme, no subsidy is given on behalf of the government. If the applicant has applied for a subsidy under any other scheme in which the government provides capital subsidy, then the subsidy can be linked to Mudra Loan. |
How To Apply For Mudra Loan
Step 1: Contact Bank To apply For Loan under Mudra Loan Scheme
There is no fixed procedure for applying for loans under the Mudra Scheme .To get the loan, the applicant should first contact the banks around him and gather all the information about the loan process and interest rate.To get the loan, you have to complete the application form and submit some documents along with it.
Step 2: Preparing documents and submitting applications
To provide loans, banks usually want to get two types of information based on your financial needs in which they can demand different types of documents:
1.First of all you need a Udyog Aadhaar Registration and get the certificate from the govt. Under Udyog aadhaar benefits you will get the loan or subsidy from the department. So for the Mudra loan all the banks always required the UAM Registration number.
2.Try to know the various documents like Balance Sheet, Income Tax Returns and information about your current business, whether you have the ability to repay the loan with interest, or not. Banks try to know this. That’s how much risks are in your business so that they can ensure that the money given by them will be safe.
3.Banks try to know through your future Business Plan, Project Report, Future Income Estimates, etc., to know about the types of work that will be used in the loan given by the bank and how much and how the benefits of business will increase due to that loan. |
Documents Required Mudra Loan
Generally, for the Mudra Loan, you have to submit the following documents with the application form that are as follows:
- First of all, we will tell you to get a Mudra Loan, you will have to provide a PAN Card ,Aadhar card, driving license, voter ID card or passport for identification.
- To get the Prime Minister’s Mudra Loan, you can also give a bill of electricity to the voter ID card, Aadhaar card passport, for proof, if the applicant receiving the Prime Minister’s Mudra Loan is from Scheduled Caste tribe or Backward Class. He will also have to give certificate.
- Under the Mudra Loan Scheme, a person will have to report the sale and profit loss during the financial year. If a person shares a company or any business, then he has to give that copy too.
- When the person makes an application, he will have to give his two photos if he is partnering with someone else. Then he will have to give two more photographs along with him.
Download Mudra Loan Application Form
For Mudra Loan, you can get the application form from the concerned bank or you can download it from the website of the online bank to carry out application process.
Step 3. Loan Processing
After submitting the application form with the Proper Documents, the bank will scrutinize your documents and can also request some more documents to be fully satisfied. This process may take some days and process of Loan Processing Once completed, you will be given a check of the disbursement amount deposited in the applicant’s bank account.
Banks ensure that the amount of loan is spent only for your business or for the purpose, for which the loan has been given. For this, they take several steps like if the applicant has to buy any large machinery or equipment in his project, then payment should be done through check.
Rejection of Loan Application
If the applicant’s documents and the industry / business project bank shown are not correct, then the bank can also reject the applicant’s application. If there is a small mistake in the documents and applications, then the bank only approves the applicant and clears the loan and approves the LOAN.
While providing loans to all applicants taking Mudra Loan, Mudra cards (Rupay Debit Card) will be issued, which will be similar to the debit card in a manner. In this way, the practitioner will be able to spend up to 10% of his currency loan with Mudra card. The purpose of the Mudra Card is to fulfill the requirements of the working capital of the businessman so that the businessman can pay daily business expenses for his business through the card card and reduce the interest cost.