Numerous entrepreneurs do not have access to formal channels of borrowing and for them; Mudra is the best possible option to avail a loan, this scheme ensures that small businesses get refined financial support from banks, private sector banks, urban cooperative banks, regional rural banks, microfinance institutes, and non-finance companies.
The eligibility to avail Loan under the PMMY (Pradhan Mantri Mudra Yojana) scheme is given under three different categories- Shishu, Kishor, and Tarun.These categories cater to start-ups as well as existing businesses looking to grow their business further. The mudra scheme is a loan scheme that is approached primarily by a small business firm that requires financial help to expand.
Let’s have a look at the top 5 benefits of availing a PMMY scheme.
Avail high loan amount under Mudra scheme
The loan amount offered under the mudra yojana scheme starts from Rs. 50,000 and goes up to Rs. 10 lakh to start-up enterprises, small business units, and MSMEs. The credit products offered under the mudra loan scheme help micro-units or small businesses to grow and expand their businesses or manage operational needs through easy finance schemes.
No collateral required
The Pradhan Mantri MUDRA Yojana loan is an unsecured type of business loan that means the loan borrower does not require to pledge their valuable assets as collateral to the lender.
The Micro, Small, and Medium Enterprises (MSME) sector have, for long, been overlooked because of their lack of reliable financial information and presumption of not being able to generate as much revenue. As a result, the growth of this very potent sector has remained stunted and suffered due to a lack of access to capital. The Mudra loan scheme addresses this issue by offering the MSME sector quick services with easy clearances, all of which have helped the sector immensely.
Favorable for small or micro firms
Micro Credit Scheme is offered to the individuals for specific income-generating micro-enterprise activity under the Pradhan Mantri MUDRA Yojana. This scheme offers financial backing for the empowerment of micro-small businesses as well as startups. Under the Pradhan Mantri MUDRA Yojana scheme, the government is the credit guarantee for the borrower. That means if the loan borrower fails to pay off the loan, the government bears the loan’s responsibility. The smallest business units like shopkeepers and food vendors can also get benefits of Pradhan Mantri MUDRA Yojana.
The loan amount can be utilized for multiple purposes
Mudra Loan scheme is directed towards vendors, shopkeepers, providing working capital loans through the Mudra Cards, providing equipment financing for micro-units along with transport vehicle loans. The loan facility is extended under the PMMY scheme for any type of fund or non-fund based needs. By opting for Pradhan Mantri MUDRA Yojana, people can avail business loans for small amounts at nominal interest rates from legitimate lenders.
Types of Financial Institutions to Apply for Mudra Loan
- Private sector banks
- Public sector banks
- Small finance banks
- Regional rural banks
- Microfinance institutions
How to Apply for Mudra Loan Online
Here are the steps to apply for mudra loan:
Step 1: Make sure that you have all the necessary documents ready along with your Pradhan Mantri Mudra Yojana application form such as ID proof, address proof, and business proof.
Step 2: The next step of your Mudra loan application would be to find a lender registered under the Mudra scheme.
Step 3: The next step is to fill your Mudra loan application form.
Loans as per the MUDRA scheme are available to those who qualify under the basic eligibility criteria. You can easily avail loans of up to Rs. 10 lakhs. If you plan on getting started with your start-ups or looking for new-age infrastructure or a small and medium enterprise looking to upgrade machinery, you can find a business loan of up tailored to your needs on Finserv MARKETS. The online application process is quite convenient with zero collateral, flexible repayment options, and a high loan amount of up to ₹30 lakhs. The disbursal of loans takes less than 3 minutes along with exclusive offers on loans.
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