Home Discover Journals Mudra Loan Schemes for MSMEs With No Collateral

Mudra Loan Schemes for MSMEs With No Collateral

By Finserv MARKETS - Sep 9,2019
Views Icon370 Views 0 0 Comments

Mudra Loan Schemes for MSMEs With No Collateral

The expansion of Micro, Small and Medium Enterprises (MSMEs) has contributed massively to the industrial growth of our country. Moreover, MSMEs also create a lot of job opportunities, thereby solving the major issue of unemployment to a certain extent. Since MSMEs are considered as the backbone of the Indian economy, the Government of India has taken several initiatives to promote MSMEs by resolving the common challenges often faced by them. One of the major concerns faced by MSMEs is unavailability of sufficient funds for their expansion. In order to resolve this issue, the Government of India has launched several financing schemes for MSMEs. One such scheme is the Mudra Loan Scheme.

Mudra loan Scheme for MSME

  • Micro-Units Development and Refinance Agency (MUDRA) is a government established organization that offers funds to small businesses in India.
  • MUDRA loans are approved and disbursed by public and private sector banks, small banks, rural banks, scheduled banks, and co-operative societies that come under this scheme. The structure of Mudra loan is as follows:
    • Sishu Loans – Rs. 50,000
    • Kishor Loans- Rs. 5,00,000
    • Tarun Loans – Rs. 10,00,000
  • One of the major benefits of the Mudra Yojana is that the loans under this scheme are provided without any demand for any collateral security from the MSMEs.
  • The interest rate in case of Mudra Loan doesn’t exceed 1.00% per month and depends on the base lending rates of financing institutions.
  • It is an MSME Loan that doesn’t involve processing charges or Loan application fees.

Mudra loan eligibility

  • All small business and enterprises can benefit from this scheme. Traders, manufacturers, service providers, self-help groups, artisans, and even those who are working at lower levels are eligible beneficiaries of the Pradhan Mantri Mudra Yojana.
  • In order to avail financial aid under the Mudra Yojana, it is necessary that the beneficiaries should not have defaulted repayment of earlier loans taken from any financial institution.

Documents required for loans under MUDRA scheme are as follows:-

  • MUDRA Loan Application with self-attested identity proof of loan applicant and 2 passport size photographs.
  • Loan application prescribed by the financial institution seeking information about the applicant, past financial results and profile of the activity proposed
  • Details of suppliers, types of machinery, as well as other items to be purchased for the activity proposed.
  • Identity of business ownership and business address.
  • Copies of necessary licenses and certificates to carry out the trade or activity for which the finance is availed.

Now that you are well aware of the details of Mudra loan scheme, ensure to make the most of it while arranging finances to support your business.

Apart from coming up with various initiatives to support businesses, the government has also launched schemes to provide affordable houses to the individuals belonging to financially weaker sections.

In today’s era, availing a business loan to expand your business or to start a new business is fairly easier with the help of online business loans which come with various benefits.. The Bajaj Finserv Business Loan offers competitive business loan interest rates and other attractive features such as low processing fees, zero hidden charges, and flexible repayment option. These features make Bajaj Finsev Business Loan an ideal financing option to start a new business.

You can also read about benefits of business loan.

Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. Loans, Insurance, Investment, and exclusive EMI store, all under one roof- anytime, anywhere!

Comments

Connect with Us
Connect with Us

Bajaj Finserv Direct Limited ("BFDL"), erstwhile Bajaj Financial Holdings Limited is a registered corporate agent of Bajaj Allianz Life Insurance Company Limited and Bajaj Allianz General Insurance Company Limited under the IRDAI composite registration number CA0551 valid till 10-Apr-2021. BFDL also renders services to Bajaj Finance Limited (‘BFL’) and Bajaj Housing Finance Limited (‘BHFL’) (referred hereinafter as ‘Lending Partner’) in sourcing of customers, providing preliminary credit support activities, fulfilment services and post-acquisition customer services related to lending business. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522