Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme of the Government of India designed to facilitate microcredit for income-generating non-farm enterprises. Under this scheme, micro and small enterprises in manufacturing, trading, services, and allied agricultural activities (such as poultry, dairy, and beekeeping) can avail loans up to ₹10 lakhs. The financial assistance is extended by eligible Member Lending Institutions (MLIs) including public and private sector banks, cooperative banks, rural banks, Micro Finance Institutions (MFIs), NBFCs, Small Finance Banks (SFBs), and other approved financial intermediaries.
Benefits
The scheme is classified into three categories to suit the growth stage and funding needs of the entrepreneur:
-
Shishu:
Loans up to ₹50,000. -
Kishore:
Loans above ₹50,000 and up to ₹5 lakhs. -
Tarun:
Loans above ₹5 lakhs and up to ₹10 lakhs.
Key benefits include:
- Access to collateral-free finance.
- Flexible loan limits based on the enterprise’s requirements.
- No involvement of agents or middlemen—borrowers must approach MLIs directly.
- Interest rates are determined by the MLIs in accordance with Reserve Bank of India guidelines, and processing fees may be charged as per internal guidelines (with many banks waiving fees for Shishu loans).
Eligibility
Eligible borrowers under PMMY include:
- Individuals
- Proprietary concerns
- Partnership firms
- Private Limited Companies
- Public Companies
- Any other legally recognized business forms
Important Considerations:
- Applicants should not be defaulters to any bank or financial institution and must maintain a satisfactory credit record.
- Individual borrowers may be required to demonstrate the necessary skills, experience, or knowledge to undertake the proposed business activity.
- Educational qualifications, if required, are assessed based on the nature of the proposed activity.
Application Process
Online
Before enrolling, ensure you have the following prerequisites:
- ID Proof
- Address Proof
- Passport-size photograph
- Applicant signature
- Proof of identity/address of the business enterprise
Steps:
-
Access the Portal:
Visit the official PM MUDRA website and select the Udyamimitra portal. -
Start Application:
Click on the “Mudra Loan Apply Now” button. -
Choose Category:
Select one of the following: New Entrepreneur, Existing Entrepreneur, or Self-employed Professional. -
Generate OTP:
Enter your name, email, and mobile number, then generate an OTP for verification. -
Registration & Form Completion:
After successful registration, fill in your personal and professional details. Choose hand-holding agencies if assistance is needed for project proposal preparation. Otherwise, navigate to the “Loan Application Center” and proceed to apply. -
Select Loan Category:
Choose the appropriate category: Mudra Shishu, Mudra Kishore, or Mudra Tarun. -
Business Details:
Provide business information such as the name, activity, industry type (Manufacturing, Service, Trading, or allied agricultural activity), owner details, existing and proposed credit facilities, future estimates, and preferred lender. -
Document Upload:
Attach all required documents, including ID proof, address proof, applicant photograph, applicant signature, and proof of identity/address of the business enterprise. -
Submission:
Upon submitting the application, an application number is generated which should be retained for future reference.
Documents Required
For Shishu Loans:
- Proof of Identity:
Self-attested copy of Voter’s ID Card, Driving Licence, PAN Card, Aadhaar Card, Passport, or other government-issued photo IDs. - Proof of Residence:
Recent telephone bill, electricity bill, property tax receipt (not older than 2 months), Voter’s ID, Aadhaar, Passport, bank passbook/account statement (attested by bank officials), Domicile Certificate, or a certificate from a local Panchayat/Municipality. - Photographs:
Two recent colored passport-sized photographs (not older than 6 months). - Machinery/Item Quotation:
Quotation for machinery or other items to be purchased, including supplier details and pricing. - Business Enterprise Proof:
Copies of licenses, registration certificates, or other documents proving the ownership and address of the business unit (if applicable).
For Kishore and Tarun Loans:
- All the documents listed for Shishu loans.
- Additional requirements may include:
- Statement of accounts for the last six months (if applicable).
- Last two years’ balance sheets along with income tax or sales tax returns (for loans of ₹2 lakhs and above).
- Projected balance sheets for one year (in case of working capital limits) and for the full term of the loan (in case of term loans).
- Sales figures for the current financial year up to the date of application submission.
- A detailed project report outlining technical and economic viability.
- Memorandum and Articles of Association for companies or Partnership Deeds for partnerships.
- In absence of a third-party guarantee, an asset & liability statement of the borrower, including details of directors and partners, may be required.
Frequently Asked Questions
-
Is Khadi activity eligible under PMMY loans?
[FAQ specific answer based on guidelines; check official FAQs for details.] -
Are Mudra loans available for purchase of CNG tempo/taxi?
[FAQ specific answer based on guidelines; check official FAQs for details.] -
If I have a savings bank account with the bank, would the loan under Mudra be available based on that account?
[Generally, yes, provided the account meets the eligibility criteria; refer to the guidelines.] -
What is the turnaround time for processing PMMY-Shishu loan proposals?
[This varies by MLI; consult the official guidelines for estimated timelines.] -
Is it mandatory to submit income tax returns for availing a loan of ₹10 lakhs under PMMY?
[For larger loans, income tax returns for the preceding two years may be required.]