According to a recent study, women comprise a mere 14% of total entrepreneurs in India. To encourage and bolster ambitious women to start their own business several initiatives are being launched by the government of India. One such initiative is the Mudra loan.
Mudra Loans comes with the sole aim of fostering a culture of entrepreneurship within India which was issued under Pradhan Mantri Mudra Yojana (PMMY). Banks and other financial institutions can offer Mudra loans to women who’re having the vision to initiate their own businesses in India.
PMMY loans can be availed of by anyone looking to launch, expand, support or modernize their own SME - however, interestingly in the four years since its launch, 70% of the loan accounts have been sanctioned to women entrepreneurs.
According to the official government report for 2018-2019, the largest number of takers for PMMY loans at present are SMEs which are at the launch phase - in other words, Shishu loans are the most popular loan hogging 86% of the total number of loans issued. Kishore loans clocked 11% while Tarun loans stood at 3%.
The Mudra Yojana website states that 59,870,318 PMMY loans which are a total of Rs 321,722.79 crore have been sanctioned in 2019. Over 1.33 crore new loan accounts were sanctioned in 2018-2019 and PMMY loans continue to grow in popularity.
The Mahila Udhyami Yojana is a loan scheme designed uniquely for budding women entrepreneurs where women from all walks of life can avail of such loans. However, they would need to meet a certain set of eligibility criteria in order to get so.
Female entrepreneurs heading production and manufacturing businesses are eligible to avail PMMY loan. Examples include artisans, weavers, craftsmen, and so on.
Women entrepreneurs aiming to start, expand or modernize businesses offering services such as tailoring, phone repairing, photocopying, auto-repairing, and servicing centers, beauty parlor services and more can avail of such loans.
A cluster of artisans
Self-help groups formed by artisans
Development Commissions (Handicrafts) registered artisans
Entrepreneurs who have procured training in R-SETIS or another prescribed institution
The following individuals will not be eligible to receive this particular loan:
Recipients of government-sanctioned schemes will not be considered for this particular program
Female entrepreneurs partaking in retail trade will not be eligible to avail of this scheme
Apart, from the eligibility criteria, there are several other terms and conditions that must be taken into account when applying for a Mudra Loan for Women. To understand these terms and conditions we came up with a few of the most commonly asked questions with regard to Mudra Loans for Women. You can read more about how to apply for Mudra Loan.
Under Mudra loans for women, one can avail of up to Rs 10 lakh for the purpose of starting a small to medium-size enterprise. Additionally, female entrepreneurs may also opt for a loan in or to expand their existing SME.
The loan amount can be utilized for a variety of purposes, such as:
To meet working capital needs
To avail of fixed assets, such as equipment, furniture, tools and machinery
No collateral is required to be eligible for this scheme.
The duration of these loans can range from 3 to 5 years and can be repaid by EMIs.
This scheme can be availed of through the United Bank of India. The United Bank of India is one of 14 banks nationalized in 1969 has over 1,400 branches across the length and breadth of India.
Read the complete guide to avail the mudra scheme
Thus, Mudra loans for Women can prove to be a game-changer in turning enterprising women into successful entrepreneurs.
There might be chances, you may not qualify for such loans in the first place. In such cases, you can opt for business loans of up to Rs 30 lakh on Finserv MARKETS. The Bajaj Finserv Business Loan on Finserv MARKETS comes with a series of benefits, including zero collateral requirements, approval in less than 3 minutes and flexible repayment tenure. Your dream of running your own business needn’t be a dream anymore with the help of the business loans on Finserv MARKETS, you can turn it into reality.
Under the Mudra Yojana, The Mahila Udhyami Yojana is a scheme designed uniquely aspiring female entrepreneurs avail loan funds of up to Rs.10 lakh to start a small or micro-enterprise, also making sure the business is a non-corporate or a non-farm business.
Loans available under the PMMY scheme are divided into three different categories
The following are the key features of the Mudra Yojana scheme for women:
The loan tenor of MUDRA Yojana for women may extend up to 7 years.
The MUDRA Yojana scheme has already benefited numerous businesses with loans worth Rs.35,002.15 crore sanctioned in FY 2019 and Rs.3,21,722.79 crore sanctioned in FY 2018. The scheme can help women entrepreneurs to grow, expand their businesses, manage cash flow and meet their working capital requirements with ease.
The PMMY is a scheme launched on April 8, 2015, for providing loans up to Rs 10 lakh to non-corporate, non-farm small/micro-enterprises. The ‘Atmanirbhar Bharat Abhiyan’ or ‘Self-reliant India Scheme’, is a recent initiative taken by the government under MUDRA Shishu Category. The scheme provides relief of Rs. 1500 crore to the Shishu loan borrowers. Offering Rs. 1500 crore Interest subsidy for MUDRA Shishu Loan category. The Government of India shall provide Interest discount of 2% for fast recipients for a period of 12 months
MUDRA Card is a debit card issued against the MUDRA loan account for the working capital portion of the loan. The borrower can use the MUDRA card in multiple withdrawal and credit facilities. The MUDRA card can also act as a debit card that owners can swipe at Points of Sale (PoS) with merchants or use to withdraw cash from an ATM.