Pradhan Mantri Mudra Bank Yojana Loan (PMMY) Details – Pradhan Mantri Mudra Yojana (PMMY प्रधानमंत्री मुद्रा योजना) under the Micro Units Development and Refinance Agency (MUDRA) Bank is a new institution being set up by Government of India for development and refinancing activities relating to micro units.
It was announced by the Hon’ble Finance Minister while presenting the Union Budget for FY 2016. The purpose of MUDRA is to provide funding to the non corporate small business sector.
Pradhan Mantri Mudra Bank Yojana Loan (PMMY) Details
MUDRA would primarily be responsible for:
1) Laying down policy guidelines for micro enterprise financing business
2) Registration of MFI entities
3) Supervision of MFI entities
4) Accreditation /rating of MFI entities
5) Laying down responsible financing practices to ward off over indebtedness and ensure proper client protection principles and methods of recovery
6) Development of standardised set of covenants governing last mile lending to micro enterprises
7) Promoting right technology solutions for the last mile
8) Formulating and running a Credit Guarantee scheme for providing guarantees to the loans/portfolios which are being extended to micro enterprises
9) Supporting development & promotional activities in the sector
10) Creating a good architecture of Last Mile Credit Delivery to micro businesses under the scheme of Pradhan Mantri MUDRA Yojana
Setting up of Pradhan Mantri Mudra Yojana
The PM Mudra Yojana would regulate refinancing and development of each and every small business enterprise and would do so under Pradhan Mantri Mudra Yojana. The bank would be set up through a specific statutory enactment.
Last Mile Financers in Pradhan Mantri Mudra Yojana
Small business enterprises or entrepreneurs at micro level are often cut of from the main banking system. This is simply because of scarce branch presence. Mudra Banks under Pradhan Mantri MUDRA Scheme would partner with coordinators at local level and facilitate finance credit to ‘Last Mile Financers’ of micro/small businesses.
Target of PM Mudra Yojana
Since most of the small entrepreneurs are young, skilled and educated, the scheme would target this segment of self employed professionals including women entrepreneurs. This lot of young entrepreneurs has always been at receiving end as far as institutional finance is concerned.
PM Mudra Bank would help them smoothen their entrepreneurial productivity. The bank is said to cater a number of such entrepreneurs who are spread across the length and breadth of India. This lot certainly has limited or no access to regular banking system and credit facility.
Pradhan Mantri Mudra Yojana Official Website
Government has come up with their official site http://www.mudra.org.in/ this site currently does not have any concrete information. This site may offer some statistics in future regarding the number of loan disburse and any other statistical information.
How to Apply for Mudra Yojana Loan
First phase of Mudra Loan yojana would start from 25th Sep and it will end on Oct 2 2015 so you guys will have a very little time to apply. Please connect with all the banks near you and they will tell you weather or not they would accept Mudra Loan form so as to avoid last minute rush. Bank Manager may ask you tons of documents about your business and many other things so make them handy. Bank manager will also visit your actual place of work to ensure you own a business.
Stages of Loan under PMMY
The extent and limit of PM Mudra Bank financing would be spread across three stages, namely Shishu, Kishor and Tarun, depending upon the level of entrepreneurship. Each stage would have a maximum limit of credit that could be provided to the entrepreneurs.
Shishu: For funding starter entrepreneurs with up to Rs 50,000.
Kishor: Under this stage the entrepreneur would be offered an amount between Rs 50,000 to Rs 5 lakh, depending on the requirements and eligibility.
Tarun: Under this stage the entrepreneur would be offered a loan of up to Rs 10 lakh, provided he meets the eligibility conditions and furnishes relevant proofs.
| PM Mudra Yojana Stage | Loan Amount |
| Shishu | up to Rs 50,000 |
| Kishor | 50,000 to Rs 5 Lakhs |
| Tarun | up to Rs 10 Lakhs |
PM Mudra Yojana, in a Nutshell
- The move, as claimed, would benefit around 58 million small businesses in the nation, who employ more than 120 million people, mostly from the unprivileged sections of society.
- It is said to be a move which would ‘fund the unfunded’
- There are millions of small business owners across the country, who have remained outside the ambit of formal institutional finance. However, they are the largest contributors to the economy.
- To facilitate absolute access to institutional finance to needy entrepreneurs working as small and micro business units.
- The initiative would certainly structure a fair environment for repayment and would take care of the financing practices to small and micro start up institutions.
With such a noble move by the central government, we just hope that the execution part of this scheme would be well managed. Moreover, this would also encourage state governments and banking agencies to come up with similar promotional schemes to promote and support the young and small entrepreneur community in the country.
PMMY Mudra Yojana Application form.
Currently only application form of Shishu (loan up to rs 50,000) has been published. You can download this form using official website
Mudra Card
Mudra Bank was formed under the Pradhan Mantri Mudra Yojana. The aim of this scheme was to provide funding to micro-entrepreneurs, providing a formalized pool of small businesses operating in India. Stabilizing the microfinance sector of the country was yet another aim. The Mudra Card is a step that will come as an aid to the scheme, helping to propel the overall cause.
The Union Government aimed for the following things with the introduction of Mudra Card:
- The card will act somewhat like a credit card or overdraft facility with a pre-approved amount of loan.
- This credit line can be used by small business owners to buy components and raw materials required for their businesses.
- Such purchases are supposed to be me made online and from producers who are registered with the platform.
- Borrowers can actually link this card with their savings accounts under Pradhan Mantri Jan Dhan Yojana. This will allow the users to withdraw money from ATMs. Thus, the card will effectively cater to liquidity crunches that most of the micro business units face in this country.
Mudra Bank Yojana Document Checklist
| 1 | Proof of identity | Self certified copy of Voter’s ID card / Driving License / PAN Card /Aadhar Card/Passport. |
| 2 | Proof of Residence | Recent telephone bill, electricity bill, property tax receipt (not older than 2 months), Voter’s ID card, Aadhar Card & Passport of Proprietor/Partners/Directors |
| 3 | Proof of SC/ST/OBC/Minority | |
| 4 | Proof of Identity/Address of the Business Enterprise | Copies of relevant licenses/registration certificates/other documents pertaining to the ownership, identity and address of business unit |
| 5 | CIBIL Report | Applicant should not be defaulter in any Bank/Financial institution |
| 6 | bank Statement | Statement of accounts (for the last six months), from the existing banker, if any. |
| 7 | ITR | Last two years balance sheets of the units along with income tax/sales tax return etc. (Applicable for all cases from Rs.2 Lacs and above). |
| 8 | Projected balance sheets | for one year in case of working capital limits and for the period of the loan in case of term loan (Applicable for all cases from Rs.2 Lacs and above). |
| 9 | Sales Docs | Sales achieved during the current financial year up to the date of submission of application |
| 10 | Project report | containing details of technical & economic viability. |