Understand in detail about Mudra Bank Features and Benefits

Mudra Bank Features and Benefits

Mudra Bank Features and Benefits

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Mudra Bank Features and Benefits

MUDRA Bank or Micro Unit Development and Refinance Agency Ltd. was launched in March of 2015. This is an initiative of the government which was reported in the Union Budget of 2015-16. All the sole traders and the owners of MSMEs (Micro, Small, and Medium Enterprises) who are working in non-agricultural activities and services across the nation, including semi-urban, urban, rural areas, and metro are eligible for Mudra Loan.

Mudra Bank's Objectives and Advantages

The aim of the MUDRA Bank was to provide the services like savings accounts, credit card, and loans, to people in the remote areas. Below given is the list of the services offered by the MUDRA Scheme:

  • Providing Refinance Support -

MUDRA offers refinance endorsement, which will help the micro-units to receive funds from various banks. MUDRA Loan of up to Rs. 10 Lakhs is offered. The loan is offered through microcredits scheme, programs for enterprises of women, securitization of assets of loan, and refinance plan for commercial banks/scheduled cooperative banks/rural banks.

  • Credit Guarantee -

The facility of Credit Guarantee is offered only to those who are under the loan scheme of MUDRA. Due to Credit Guarantee, risk sharing is offered for a group of homogenous loans, in place of a guaranteed loan for a debt of an individual. This improves receptiveness and efficiency of the product of Credit Guarantee.

  • Developmental and Promotional Support -

Developmental and promotional supports can also be availed by the customers. This consists of advancement in financial literacy, entrepreneurship development, skill development, institution development, and sectoral development.

Various Schemes Provided Under the MUDRA Loan

Depending on the borrowing organization's funding requirement and various phases of development, PMMY or Pradhan Mantri Mudra Yojana is categorized into three different schemes and its brief description is given below:

 

  • Shishu - This scheme is for the starters, that is those who are interested in starting up their new business. In this category, you can avail of a loan of up to Rs. 50,000.

  • Kishor - In this scheme, the amount of loan varies from Rs. 50,000 to Rs. 5 Lakhs, based on the requirement of the borrower. Those who are categorized under the business of mid-level organizations can avail of this scheme.

  • Tarun - Entrepreneurs and established businesses can avail of Tarun loan and if you are opting for this scheme then you can easily avail a loan amount from Rs. 5 Lakhs to Rs. 10 Lakhs.

How to Apply for MUDRA Loans?

The loan provided under MUDRA Bank has helped a lot of people to achieve their goals. If you desire to start up or develop your business further, then opting for the Mudra scheme will be beneficial for your business. The steps to apply for Mudra loan are:

 

  1. Visit https://mudra.org.in/ to download your application form.

  2. Fill in all the required details like loan amount, residence type, your yearly sales, number of years in your current profession, current city, and mobile number. Depending on the bank you are applying to, the application procedure may differ slightly.

  3. Visit your nearest desired bank and submit the application form along with essential documents. You need to be aware of which banks offer MUDRA loans. You can visit the bank you desire and enquire regarding the same.

  4. If you have met all the procedures then in 7 to 10 working days your loan will be approved.

Documents required for MUDRA loan

To apply for the MUDRA scheme, there are some crucial documents that you need to provide. The list of those essential documents required are as follows:

 

  1. Self-penned business plan

  2. Application form duly filled along with the recent photographs of passport size

  3. Applicant's and the co-applicant's KYC documents which must include:

  1. Voter ID card

  2. Passport

  3. Aadhaar card

  4. Pan card

  5. Driving license

  6. Utility card (electricity bills or water bills)

  7. If you belong to any special category like OBC, SC, ST, minority, etc.

  8. Statement of your bank of last 6 months

  9. Other documents demanded by the bank

Conclusion

MUDRA scheme focuses on the development of entrepreneurs and businesses by offering loans and reaching the areas where numerous bank services couldn't fulfill the requirements of the client. Due to the MUDRA scheme, many start-ups like manufacturers, trading, and non-agricultural sectors have successfully developed their business.

If you're not eligible for this loan or are looking for options, you can check out Business Loans available on Finserv MARKETS. The benefits include hassle-free application procedure, competitive interest rates, flexible repayment options and much more.