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The MUDRA scheme, also known as Micro Units Development & Refinance Agency scheme, was introduced on April 8, 2015, with the goal of assisting small or micro firms by providing refinancing. This scheme offers loans of up to Rs. 10 Lakhs to non-corporate, non-farm small/micro firms and these loans are known as MUDRA Loans. The government offers these loans to borrowers through Banks, MFIs, and NBFCs. With the help of this loan, small/micro organizations can grow their businesses.


The MUDRA scheme is classified into three categories that are 'Shishu, Kishore, and Tarun.’

Each category offers different funding in accordance with the requirements of the borrower.

  • Shishu: Upto Rs. 50,000

  • Kishore: Between Rs. 50,000 to Rs. 5 Lakhs

  • Tarun: Between Rs. 5 Lakhs to Rs. 10 Lakhs


This financing, however, is not accessible to every entrepreneur. The government has created a list of enterprises that are qualified for a MUDRA Loan. As a result, before applying for this loan, you must determine whether your business falls under the MUDRA scheme or not.

List of Businesses That Can Avail Mudra Loan

Here is the list of businesses that can acquire this loan.

  • Any startup firm

  • Machine operators

  • Artisans

  • Truck operators

  • Traders and shopkeepers

  • Small vendors selling fruits and vegetables

  • Commercial transportation companies who purchase passenger vehicles such as auto-rickshaws, two-wheelers, small goods transport vehicles, 3 wheelers, e-rickshaws, taxis, tractors, etc

  • Small scale manufacturing units with millions in ownership or partnership corporations that are classified as non-corporate small businesses

  • Tailoring shops, dry cleaning, bike repair shops, boutiques, beauty parlours, boutiques, pharmacies, gyms, photocopy shops, stationery stores, salons, courier services, and other similar service sector units

  • Food product units including small service food stalls, bakery product makers like biscuits, bread and buns, run canteen services, makers of jams, jellies, papad, pickles, sweets, ice creams, etc

  • Small scale industries that are involved in chikankari, cotton ginning, other traditional embroidery and handwork such as zari, zardozi, handloom, knitting, sewing, apparel designing, computer-based embroidery on clothes, traditional dyeing, printing such as power looms, and so on

  • Units that manufacture non-garment products such as bags, vehicle accessories, home furnishings products, etc

  • Agriculture-related businesses such as beekeeping, food & agro-processing, poultry, grading, fishery, sorting, aggregation agro industries, pisciculture, dairy, agri-clinics, agribusiness centres, etc. (excluding crop loans, land improvements such as canals, irrigation, and wells)

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With a vision to provide refinancing to MSME units as well as to encourage youth entrepreneurs, the MUDRA scheme is focused on the development and growth of the country. The three products offered by MUDRA Shishu, Kishore and Tarun, are developed to meet the requirements of different sectors/ business/ entrepreneur segments. You can opt for any of them and grow your business.


Your identity proof, address proof, income proof, bank statement for the last six months, and passport size photographs are the most important documents for a MUDRA Loan. You can also check detailed list of mudra loan documents

No, you are not obligated to provide any collateral or security in order to procure this loan. 

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