Home LOAN TIPS Ultimate Guide to take MUDRA loan in India

Ultimate Guide to take MUDRA loan in India

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MUDRA Loans were launched by our honorable Prime Minister under Pradhan Mantri MUDRA Yojana (PMMY) on April 8, 2015, for providing loans up to 10 lakh to the non-corporate, non-farm small/micro enterprises. MUDRA stands for Micro-Units Development and Refinance Agency. Under this scheme, borrowers can avail business loans ranging from Rs.50,000 to Rs.10 lakh. These loans are given by Commercial Banks, RRBs, Small Finance Banks, MFIs, and NBFCs. The borrower can lead to any of the lending institutions mentioned above or can apply online through this portal “www.udyamimitra.in”. Under this scheme, MUDRA has been divided under three products called as ‘Shishu’, ‘Kishore’ and ‘Tarun’ to distinguish among the various stages of growth/development and funding requirements of the beneficiary micro unit/entrepreneur and also to provide a reference point for the next phase of graduation/growth. 

  • SBI MUDRA Loan: 

    As part of its portfolio, SBI offers a number of SME loans including the PM Mudra Yojana. According to the SBI policies, existing SBI savings and current account holding customers can apply for the SBI Mudra loan online or offline. Loan applications for up to Rs.50,000 can be submitted on the SBI e-Mudra portal –

  • https://emudra.sbi.co.in:8044/emudra. But exceeding Rs. 50,000; you need to submit and register for the loan offline only.

SBI MUDRA Loan

 

  • MUDRA Loan online apply:

      Online application can either be submitted directly through www.udyamimitra.in. or you can go for submission through any other financial institution. Let’s take an example of online submission through SBI. This process is as follows: For this, you need to Visit the SBI e-Mudra portal and there click on the button ‘Proceed’ on the homepage. Click on OK after reading instructions and then fill the form as per the requirement. Upload the necessary documents. Then you need to accept the SBI e-Mudra Terms and Conditions with an e-Sign which has to be done by Inputing your Aadhaar number. This is how SBI’s e-Mudra facility makes it easier for you to get your loans approved in minimal time and documentation. Once you submit the application form and the documents required, the bank will review it and if they are found to be in order, the loan amount will be disbursed within few days to your bank account that you’ve mentioned in the application form.

 

  • MUDRA Loan eligibility:

    As per the PMMY, eligibility criteria specified is as follows: 

 

  • Business enterprises that are engaged in manufacturing goods can avail this loan
  • Individuals who are employed in the trading and services sector can apply for the PMMY loan.
  • Those who participate in allied agricultural activities can apply for this loan.
  • People belonging to trading sector

These can apply for the MUDRA loan through any financial institution or directly through the specified portal. New and existing units both qualify for applying MUDRA loan. Business can be of small scale or large scale irrespective of the fact; it is established in urban area or rural area. Other qualifications for eligibility are that the borrower should be between 18 and 60 years of age and the deposit account should have been active for a minimum of 6 months. 

Loans that are issued under the Pradhan Mantri Mudra Yojana scheme are guaranteed under the Credit Guarantee for Micro Units and the National Credit Guarantee Trustee Company. The guarantee that is offered by the CGFMU and the NCGTC is available for a maximum period of five years. Thus, the maximum repayment scheme for the Pradhan Mantri Mudra Yojana scheme is fixed at 60 months and can lie between 3-5 years. MUDRA RuPay cards will be offered to all eligible accounts in order to make repayments.

 

  • MUDRA loan application form:

     To apply for the MUDRA loan and to ensure that the application process is smooth, you need to keep the following details ready with you. These details are as follows:

  • Your savings/current account number. 
  • Aadhaar number: This is voluntary and is required to complete the e-KYC process instantly through the mobile app. However, if you do not wish to provide your Aadhaar number online, your application will be manually processed.
  • Other details: These details include the name and address of your business and its start date that will be used to verify your business location and other essentials, Religion and community, Sales turnover figures, and Business account.  Account number, bank, and branch name where your business’ sales proceeds gets credited are some of the other main requirements.

MUDRA loan application form

 

After you’re done with all the prior formalities of the application form, you need to read through the features, benefits, and terms and conditions of the loan. If you’re all ok with the terms and conditions, verify it with your signature. Then you’re done on your part and you just need to wait for the verification of your application. Once it gets approved, you will receive the loan amount in your account.

  • MUDRA loan documents:

      To apply for the MUDRA loans, you need to keep the following documents ready for smooth proceedings ahead. You should have hard copies of all the documents or the documents should be in the JPEG, PNG, or PDF format if you’re applying through online portals and the size of each file should not exceed 2MB per file. The documents should be a photocopy or a scanned copy. These documents include the following: GST registration certificate, Shop & Establishment Certificate, Udyog Aadhaar, and your personal Adhaar number for the verification of e-signature. Any other document of business registration is also required that will verify the registration of your business entity and other details. 

 

  • Quantum of loan:

      As per the specified conditions under Pradhan Mantri MUDRA Yojna (PMMY), eligible businesses have been divided into three categories namely Shishu, Kishore, and Tarun. The quantum of loan is sub-divided under these categories to specify the maximum amount that is as under: 

  • Maximum loan amount is Rs.10 lakh loans up to Rs.50,000 under SHISHU category.
  • Maximum loan amount lies between Loans from Rs.50,001 to Rs.500,000  under KISHORE category.
  • Maximum loan amount lies between Loans from Rs.500,001/- to Rs.10,00,000/-  under the TARUN category.

 

  • MUDRA loan interest rates:

    Various banks provide different interest rates for MUDRA loans. These interest rates are as follows:

  • SBI provides MUDRA loan for  interest rate 9.75% onwards
  • Oriental Bank of Commerce provides MUDRA loan for  interest rate 8.15% onwards
  • Bank of Baroda provides MUDRA loan for  interest rate 9.65% onwards + SP (Strategic Premium)
  • Corporation Bank provides MUDRA loan for  interest rate 9.35% onwards
  • Bank of Maharashtra provides MUDRA loan for  interest rate 8.55% onwards
  • Andhra Bank provides MUDRA loan for  interest rate 8.20% onwards
  • Punjab National Bank provides MUDRA loan for  interest rate 9.60% onwards

MUDRA loan interest rates

  • Mudra Loan Subsidy

    :  No, there is no subsidy provided under PMMY for Mudra Loans.

 

  • MUDRA loan registration:

      You can either register for MUDRA loans offline or through online portal as specified by the act. 

  • Registration fee is Nil for Shishu and Kishore loans, whereas 0.5% of the loan amount for Tarun loans category. 
  • Margin limit for loan up to Rs.50,000 is nil. Whereas, for the loan amount that lies between Rs.50,001 to Rs.10 lakh is 10% for loan amount.
  •  Collateral security: No collateral is required. But, as Primary Security, hypothecation of P&M for TL and hypothecation of stocks and receivables for CC is required. 
  • Other conditions:  There are some more conditions specified under PMMY that you must be aware of.  These are as  follows:
  • The loan that you avail under Mudra Scheme is guaranteed by Credit Guarantee for Micro Units (CGFMU) and provided by National Credit Guarantee Trustee Company (NCGTC).
  • The cover is available for 5 years and hence the repayment period granted is for 60 months maximum.
  • You can view your leads and other details about MUDRA loan on Udyami Mitra Portal. This is the specified portal for all the official works related to MUDRA loan.
  • All CC account holder will be issued a Mudra RuPay card by their respective branches of the bank from which they’re availing service from. Mudra RupayCard is issued when you successfully open a Mudra Loan account with SBI. The card acts both as a debit and ATM Card. This card can be used to withdraw money as well as make other transactions wherever necessary. You can also use the card to make point of sales transactions to make business transactions.

Thus, these were all the facts and figures that you may require to proceed further with your registration for MUDRA loan. The Pradhan Mantri Mudra Yojana scheme is an ideal choice for individuals who are in need of funds to finance their various business-related requirements and are dreaming to expand their business scale irrespective of the fact whether their business reside in rural areas or urban areas. You just need to verify the eligibility criteria, other requirements of the loan specified under PMMY and you’ll receive all your amount in your respective bank account smoothly. Do check it out!

Read This Also : Taking an Educational Loan In India: A Beginner’s Guide 

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