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.
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:
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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:
Moreover, the lending institutions must meet the following requirements:
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.
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:
|Union Bank of India
|10.55% p.a. onwards
|PSB Loans in 59 Minutes
|8.50% p.a. onwards
|City Union Bank
|12.00% p.a. onwards
|Bank of Maharashtra
|9.30% p.a. onwards
|11.65% p.a. onwards
|Tamilnad Mercantile Bank
|9.45% p.a. onwards
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The documents required for Mudra loan eligibility are:
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.
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Indian citizens of 18 - 65 years of age with a non-farm business, have no criminal record nor defaulted on loans are eligible. Startups, small manufacturers and vendors, artisans, shopkeepers, retailers and MSMEs, including Private and Public Ltd companies, sole proprietorship, partnership, LLPs, NGOs, Trusts and Cooperative societies qualify for MUDRA loan eligibility.
The minimum margin for Kishore loan is 5%, Tarun loan is 25%, while Shishu loan requires no minimum margin.
Yes, ITR is required for a MUDRA loan.
The maximum loan amount for MUDRA is 10 lakhs.
Non-Residential Indians (NRIs), individuals or businesses with farm-based activities, and those with poor credit history are not eligible for MUDRA loans.
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