Govt to Provide 2% Subsidy on Shishu Loan

The Pradhan Mantri Mudra Yojana (PMMY) has emerged as the flagship scheme by the government of India to enable last mile connectivity to banking services for every citizen of the country. Under this scheme, any citizen can avail a loan of up to Rs. 10 Lakhs for activities that fall under the non-farming categories. The Mudra loan scheme assists a small borrower in accessing funds from any public sector owned bank, private sector owned bank, microfinance institutions and even non-banking finance companies (NBFCs).

 

While the Mudra loan scheme has been facilitating access to every citizen of India to loan availing facilities, several private players have also instituted digitalisation mechanisms which enable potential borrowers to easily avail credit. For instance, potential business owners can opt for the Bajaj Finserv Business Loan, available on Bajaj Markets, and easily get loans of up to Rs. 30 Lakhs within 3 minutes of making the application. The flexible repayment tenure also ensures that business owners can easily repay their business loans after taking care of all their operational necessities.

 

Under the Mudra Yojana, borrowers are split into three major categories. The Shishu loan category applies to those business owners who wish to borrow upto Rs. 50,000 in credit while the Kishor loan categories apply to those who wish to avail between Rs. 50,000 to Rs. 5 Lakhs. The Tarun loan category is exclusively pertinent to those borrowers who wish to avail a business loan amounting to between Rs. 5 Lakhs to Rs. 10 Lakhs.

 

Of these categories, the Shishu loan category has been demarcated as the most important by the government. About 60% of the credit from the entire Mudra loan scheme is designated to be spent on the Shishu loan category. These collateral-free loans are aimed at inducing a culture of creation within the country.

 

In June 2020, the government gave some further relief to the borrowers of the Shishu loan. An interest subvention of 2% was announced for these borrowers, which would be in effect for a period of 12 months. This will prove to be a significant relief measure for these borrowers, who are active across different industries and sectors.

 

When you opt for the best business loan in India, such as the Bajaj Finserv Business Loan, available on Bajaj Markets, you can easily obtain flexible repayment tenures which enable you to repay your loan amount comfortably and as installments that are more affordable to you. You can be approved for a loan amount of up to Rs. 30 Lakhs within 3 minutes of applying for the loan, and repay it within a tenure ranging from 12 to 60 months. You can also apply for the Shishu loan on Bajaj Markets and get access to multiple benefits all with the comfort of completing your application and having your funds processed online.

Benefits of Mudra Loan

There are several benefits that the Mudra loan offers to borrowers under all three categories of schemes. Read on to learn more about why you should apply for a Mudra loan to help your business idea get off the ground.

1. Collateral Free: 

While applying for a Shishu loan or any kind of Mudra loan, there is no need for you to provide any kind of security or collateral. Gone are the days when banks would seize your assets in exchange for a loan. You can now easily get a loan without offering any collateral in exchange.

2. No Processing Fees:

Previously, banks and other lenders charged hefty processing fees simply for borrowers availing loans, regardless of the loan amount. With the Mudra loan, borrowers need no longer pay processing fees while applying for the loan.

3. Large Loan Amount: 

The Mudra loan has done away with a limit on the minimum loan amount a borrower can seek. With the Shishu loan category, potential borrowers can easily avail any amount, even for values which are less than Rs. 50,000.

4. Flexible Repayment Options:

The repayment tenure on a Mudra loan can be extended up to 5 years, which makes it very convenient for businesses which are just setting up to comfortably repay the loan. The repayment tenure enables them to first make the expenses that are required for the business to grow, and then work towards making the repayment.

Types of Industries that can avail Mudra Loan

• Persons or organisations active in the land transport sector, which includes transportation for goods and also for people

• Establishments set up for social, community and personal service activities such as beauty parlours, saloons, medicine shops and even DTP and photocopying services

• The scheme is eligible to units involved in the food production sector

• The Mudra loan seeks to provide support to organisations operating in the textile sector.

The benefits of the Mudra loan can be availed by anybody through the Bajaj Markets, where you can easily have your loan application approved within 3 minutes. Through the Bajaj Finserv Business Loan, you can also avail up to Rs. 30 Lakhs and have a flexible repayment tenure ranging from 12 to 60 months.