Pradhan Mantri Mudra Yojana is a part of the 2016 financial year budget. The companies which need funding of less than Rs. 10 lakhs can take a loan easily under this scheme. Basically, this is a loan scheme by the government of India. MUDRA stands for Micro Units Development and Refinance Agency. The government has tied up with MUDRA and come up with this scheme. Hence, this scheme is known as Pradhan Mantri Mudra Yojana.
Small businesses often find it difficult to get initial funds for their business. The Pradhan Mantri Mudra Yojana will serve as a boon for the non-corporate and non-farm sector businesses. We have got here everything you need to know about this Yojana. Check it out.
Who can apply for the Pradhan Mantri Mudra Yojana?
- Only those people who have Indian citizenship can apply for the scheme.
- As per the government, under the MUDRA scheme, only non-farm activities can apply for the loan. If you are a farmer, you can choose any of the scheme launched especially for farmers.
- Also, only non-corporate activities can apply for loan under this scheme.
- The minimum age to file for the Pradhan Mantri Mudra Yojana is 23 years and maximum age is 28 years. Further, the person should pay back the loan before he attains the age of 65 years.
- The funds that the subscriber will get under this scheme should be invested only in business activities. They cannot use the funds for other tasks.
- If you have any kind of small business, such as vegetable shop, repair shop or even if you are a truck operator, you are eligible.
- The lender will duly check the genre of the business. Since it is a versatile scheme, you have many advantages. But, your business should return a profit. Government has made it mandatory that the business should have an annual turnover of Rs. 15 lakhs. Also, non-individuals can show a profit of Rs. 1 lakh. And for self-employed people, the annual profit should be Rs. 2 lakhs.
- The applicants can apply for a loan in the bank in which they have good service relations for more than a year. If you do not have an account with any bank, you can choose the other option. And the other option is to stay at one’s current residence for a year.
Key Features of the Pradhan Mantri Mudra Yojana
- Government did not assign the Pradhan Mantri Mudra Yojana scheme to a particular lender. This means that there are various lenders which can lend under the scheme.
- So, there are no particular sets of rules. One should read the terms and conditions of their lender carefully before signing them.
- Government has plans to give preference to backward classes under the scheme.
- This scheme is active throughout the country and is doing really well.
- Almost all the banks provide this scheme. So, you can approach any nearest bank of your choice.
Also read other government schemes for the welfare of the middle class.
Various Interest Rates under the Pradhan Mantri Mudra Yojana
The Pradhan Mantri Mudra Yojana is no doubt a scheme for everyone who wants funds for his own business. But all the businesses are not same. Government understands this and hence, it has divided the scheme into categories bases on interest rates. You can choose among the following categories as per your requirements.
As the name itself suggest, this is for small businesses. Shishu means baby. So, people interested in taking small sum of money as loan should apply for this. You can take a loan of up to Rs. 50000 under this category. And the interest rate in this category is 12% per annum. The subscriber can pay back the loan amount within 5 year time frame.
The second category is Kishore and it allows you to take a loan of amount higher than that in Shishu. Kishore means a teenager. And hence, if you have a middle-sized business, you can go for this. Loans which are more than Rs. 50000 but less than Rs. 5 lakhs come under this category. It will depend on the credit history of the person that how much interest bank charges him/her. Also, the time frame of repayment will depend on bank in this case.
Tarun means an adult. And hence, as the name suggests, you can take a bigger loan under this category. The rules for this category are same as Kishore. But the sum is increased to Rs. 10 lakhs. If your loan requirement is more than Rs. 5 lakhs, you can choose this category.
How to apply for the Pradhan Mantri Mudra Yojana
As mentioned earlier, there is no government body specifically assigned to the project to act as a lender. Hence, there is no fixed procedure to apply for the scheme. You can check with lenders what steps you need to follow. However, if you approach a bank, you will need to follow the below basic steps.
- Go to nearest bank branch. And discuss your business plans with them. If they are convinced, you can ask for the Pradhan Mantri Mudra Yojana requirements.
- They will give you the Pradhan Mantri Mudra Yojana form. You can also get the form for the scheme from MUDRA online website.
- You need to have a current bank account for this scheme. So, you might need to open it first.
- Fill up the form and attach the necessary documents as the bank tells you.
- Take the acknowledge slip with you.
- You will get your money in your account once the procedure is over.
Make sure that you maintain a good credit history. That will make acceptance of your loan application much easier.
What is the Mudra Loan Card?
One more thing you should in context of the Pradhan Mantri Mudra Yojana is the Mudra Loan card. You will get this card when your loan is approved.
- This is a debit card with which you can withdraw money from ATMs.
- The card will contain the loan amount.
- And the card is a RuPay debit card so you will get the RuPay features as well.
- Also, you can swipe the card at various PoS to make payments.
Let us know if want to know anything else about the scheme. We would be happy to help you.