Mudra Loan Eligibility

Micro Units Development and Refinance Agency Ltd (MUDRA) is a government of India initiative operating under the umbrella of Pradhan Mantri Mudra Yojana (PMMY). Its primary objective is to provide financial assistance of up to 10 lakhs to small and micro enterprises, startups and MSMEs who qualify for MUDRA loan eligibility. MUDRA collaborates with banks and NBFCs to extend credit to businesses who are seeking expansion or establishment of their ventures.

The MUDRA loan eligibility criteria are designed to include a diverse range of businesses, providing them access to vital resources for growth and development.

Eligible Individuals & Businesses for Mudra Scheme

The scheme emphasises on inclusivity, with the aim to support a wide range of micro and small enterprises. The MUDRA loan eligible criteria for individuals and businesses include:

• Applicants who fall under the age group of 18 to 65 years.
• They must be an Indian citizen with no criminal record.
• They must have had no defaults on loans from banks or NBFCs in the past.
• Non-farm enterprises engaged in trading, services and manufacturing sectors are eligible.
• Eligible entities are individuals engaged in poultry and livestock activities, startups, small manufacturers and vendors, artisans, fruit and vegetable vendors, shopkeepers, retailers and MSMEs.
• Eligible enterprises include Private and Public Ltd companies, sole proprietorship, partnership, LLPs, NGOs, Trusts and Cooperative societies.

Lenders Eligible to Provide Mudra Loan

The Mudra Loan scheme aims to empower small businesses in India by providing them with access to affordable credit, promoting financial inclusion, and creating a supportive ecosystem for entrepreneurs. Here are the highlights of the objectives of the Mudra Loan:

• Public and Private Sector Banks
• Non-Banking Financial Institutions
• Regional Rural Banks
• Small Finance Banks
• Micro Finance Institutions

Moreover, the lending institutions must meet the following requirements:

• Eligible lenders must have been generating profit for the last two years.
• The net performing assets of private, public and regional rural banks should not exceed 10%, 15% and 6%.
• Private and Public sector banks should have a networth of 250 Crore.
• Regional Rural banks should have a net worth of at 50 Crore above.

Loan Amount Offered Under Mudra Loan

The maximum loan amount offered under MUDRA loan is 10 lakhs for a tenure of 5 years. However, the loan amount that individuals and businesses will get will depend on their stage of development, growth and financial requirement. Based on this, applicants can avail loans under the following categories:

Shishu: Loan amount up to ₹50,000 for businesses at the initial stage of development.

Kishore: Loan amount above ₹50,000 to ₹5 lakhs for established businesses looking to expand.

Tarun: Loan amount above ₹5 lakhs to ₹10 lakhs for larger businesses with growth potential.

Mudra Loan Interest Rates

The interest rates offered by MUDRA loan will vary depending on various factors including the loan amount, lender, borrower’s creditworthiness and tenure. The interest rate for a MUDRA loan usually starts at 9.45% onwards.

The table below shows the different interest rates offered by different lenders:

Documents Required for Mudra Loan

The documents required for Mudra loan eligibility are:

• MUDRA loan application form
• KYC documents: PAN card, Aadhaar card, Voter ID, Passport, Driving licence, Utility bills, Rental agreement, etc.
• ST/SC/OBC/Minority proof, if applicable.
• Income Proof: Latest ITR
• Last 6 months bank statements.
• Proof of business continuity
• Business incorporation certificate, if required.
• Passport size photographs.

Note: These rates are indicative and subject to change. Always check with the bank for the most up-to-date information before making any investment decisions.