Mudra Loan Interest Rate

Compare interest rates of some of the banks providing Mudra Loan

Check your Business Loan Offer

✓Minimal Documentation ✓Flexible Repayment ✓Collateral Free Loan | Apply for Business Loan Now! Apply Now

The interest rate on a Mudra loan starts at 8% per annum. There is a reduction of 25 basis points on interest rates to Micro Finance Institutions (MFIs) and NBFCs providing loans to women entrepreneurs. In the case of the working capital loan, banks charge interest rates only on the amount held overnight.

Read on to learn more about the interest rates offered by different banks on Mudra loans and tips to get lower interest rates.

Mudra Loan Interest Rates Offered by Banks

The following table provides details about the interest rates and tenures offered by different lending institutions:

Bank	Interest Rate (p.a.)	Tenure
State Bank of India (SBI)	Linked to MCLR	3-5 years (with a moratorium period extending up to 6 months)
IDBI Bank	Linked to Bank’s Base Rate and Rating	12 months to 5 years
Bank of Baroda	Linked to MCLR	Up to 7 years
Union Bank of India	As per the bank’s guidelines	Up to 7 years (with a moratorium period of up to 6 months)
Central Bank	Based on RBLR	7 years
Indian Bank	Based on the repo rate	2-5 years
Bank of India	As per the bank’s guidelines	3-7 years

Disclaimer: The above interest rates and terms are subject to change at the lender’s discretion.

Tips to Get Mudra Loans at Affordable Interest Rates

Here are certain tips you can utilise to get a Mudra loan at low interest rates:

Compare lending offers from different banks, NBFCs, and MFIs
Maintain higher creditworthiness and repayment capacity as banks can offer lower rates to such borrowers
You can also get lower interest rates if your annual turnover is higher and business risk profile is low
A good credit history with no default or late repayments also helps ensure lower interest rates