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The Government of India’s PMMY (Pradhan Mantri MUDRA Yojana) aims to provide a boost to the MSME economy. The scheme allows non-corporate and non-agriculture MSMEs to avail loans of up to ₹10 Lakhs. There are three categories of loans that can be availed by an MSME under the PMMY:

MUDRA Loan Category

Loan Amount




₹50,001 to ₹5 lakh


₹5 lakh to ₹10 lakh

Among the aforementioned categories, 79% of the total number of loans granted under PMMY are Mudra Shishu Loans. In terms of monetary value, the share of Shishu loans is 33% of the total loan amount disbursed under Mudra.

Features of the Mudra Shishu Loan

Shishu loans under the Mudra scheme are intended to benefit small businesses and provide for their working capital needs. Some of the salient features of Mudra Shishu loans are as under:


  • Zero processing fee

  • Affordable interest rates, generally not exceeding 12% p.a.

  • Repayment tenure of 3 to 5 years

  • Online as well as in-person application process

  • Loan amount of up to ₹50,000

Documents Required for Mudra Shishu Loan

1. KYC Documents

  • Identity Proof: PAN card, passport, Aadhaar card, driving licence, Voter’s ID

  • Address Proof: Aadhaar card, bank account statements, Ration card, rent agreement, phone bill, power bill

2. Other Financial Documents

  • Income Proof: Latest salary slips, Income Tax Returns, or Form 16

  • Address proof of the business

  • Registration certificate of the business

  • Proof of business continuity

  • Director Identity Number (DIN) of all the directors of the firm, if applicable

  • Photographs of the applicant(s)/director(s) or all of the partners

  • Income tax returns of the past 2 years

  • Bank statements of the past 12 months

  • Sales records of the current financial year

  • Assets and liabilities statement of the firm

  • Memorandum of Association (MOA) or Articles of Association or the deed of partnership

  • Relevant registrations and permits in the name of the business with the concerned authorities

Application Process for Mudra Shishu Loan

You can easily apply for a Mudra Shishu Loan for your business online by following the below-mentioned steps:


  • Step 1: Visit the Udyami Mitra website at https://udyamimitra.in/ and click on “Apply Now”.

  • Step 2: Enter name, email address and mobile number at the bottom of the page and click on “Generate OTP”. Now enter the OTP received and complete the process by clicking on the ‘Verify OTP’ button.

  • Step 3: Fill in all personal and professional details on the following page and click on the “Apply Now” button under “Loan Application Center”.

  • Step 4: Select ‘Shishu’ to apply for a Shishu Loan.

  • Step 5: Now, you need to enter a few details about your business such as background information of the proprietors and directors of the firm, future working capital estimate, lender of preference, etc.

  • Step 6: Once the above information has been filled in, click on the ‘Submit’ button. Finally, you will be taken to a declaration page. Tick the appropriate checkbox to continue and complete the application process.

Once you complete your Mudra Shishu Loan application process, a success message with the loan application number will be displayed on the screen. Note the reference number for future correspondence.


Alternatively, you can also apply for the Shishu loan offline by visiting your nearest branch of the bank you wish to avail the Mudra Shishu loan from. All you need to do is obtain the Mudra loan application form from a bank official, fill in all the requisite details in the form and attach all the relevant documents and submit the same to the bank official. Once all your documents are verified, your loan shall be approved and the amount shall be disbursed to your bank account.

Annual Reports of Mudra Shishu Loan

Over 4 crore businesses benefited from Mudra Shishu Loans in FY 2020-21 with the total sanctioned amount exceeding ₹1 lakh crore. You may refer to the table below to get an idea of the number of loans granted and the total loan amount sanctioned in the past six financial years under Shishu category of Pradhan Mantri Mudra Yojana:

Financial Year

No. of Loan Accounts

Total Amount Sanctioned

FY 2020-21


₹1,09,953 crore

FY 2019-20


₹1,63,528 crore

FY 2018-19


₹1,42,345 crore

FY 2017-18


₹1,06,001.6 crore

FY 2016-17


₹85,100.74 crore

FY 2015-16


₹62,894.96 crore

Interest Subvention Scheme for Mudra Shishu Loans Under PMMY

Under the Atma Nirbhar Bharat Package, the Government of India announced the ”Interest Subvention Scheme for MUDRA – Shishu Loans” in May 2020 with an objective to help small businesses mitigate the impact of the COVID-19 pandemic. Under this scheme, Mudra Shishu Loan beneficiaries were provided an interest subsidy of 2% for a period of 12 months.


The Mudra Shishu Loan scheme is a boon for aspiring entrepreneurs in the country as they can easily avail small loans at affordable interest rates to fulfil their working capital needs. Once they expand the business to a certain level, they can also consider Kishore and Tarun loans under the Mudra scheme. However, if your business belongs to the MSME sector and you need a capital of more than ₹10 Lakhs, you can always apply for a business loan at Bajaj MARKETS. You will not only get the loan at attractive interest rates, but the application process is also simple and hassle-free and one that requires minimal documentation.