PM Mudra Yojana: How to Apply for a Loan Online, Interest Rates, Criteria and More

The Modi government launched Pradhan Mantri MUDRA Yojana in 2015. Here, MUDRA stands for Micro Unit Development and Refinancing Agency.

Under this scheme, the government provides loans of up to Rs 10 lakh to non-farm and non-farm small/micro enterprises. These loans are provided through commercial banks, regional rural banks (RRBs), small financial banks, microfinance institutions (MFIs) and non-bank financial companies (NBFCs).

MUDRA LOAN: How to Apply

A borrower can go to any of the branches of the banks (mentioned above) and apply for the loan. A borrower can also apply online by visiting

MUDRA LOAN: Eligibility

Any Indian citizen who is eligible for a loan and has a business plan for an income generating activity can apply for a MUDRA loan. The loan proposal must relate to the creation of a new micro-enterprise or the upgrading of an existing micro-enterprise in the manufacturing, processing, trade and service sectors.

Anyone including women, business owners, general partnerships, limited liability companies or any other entity is eligible for PMMY loans, the loan requirement of which can reach Rs 10 lakh.

The bottom line is that a MUDRA loan is eligible for any income generating activity.

However, it should be noted that the applicant must not be a defaulter of any bank or financial institution.

Types of MUDRA Loans

Shishu: Cover loans up to Rs 50,000
Kishor: Cover loans above Rs 50,000 and up to Rs 5 lakh
Tarun: Cover loans above Rs 5 lakh and up to Rs 10 lakh

Types of financial support from MUDRA:

Micro Credit Scheme (MCS) for loans up to Rs 1 lakh funding through MFIs.

Refinancing program for commercial banks / regional rural banks (RRBs) / small financial banks / non-bank financial companies (NBFCs).

MUDRA: documents and rules required to register for the program

Identity proof

Proof of address

Proof of category of SC, ST, OBC, Minority if applicable

2 copies Photograph of the applicant (not older than 6 months)

Quotation of machines or other items to be purchased

In addition to these documents, the applicant must also submit the name of the machine supplier, the details of the machine and its price.

For business, applicant must present proof of business ID/address and all necessary licenses/registrations/certificates etc.

Also, MUDRA loans have no processing fees or collateral for the loans. In addition, the loan contracted can be repaid in 5 years.

What is the MUDRA card?

The MUDRA card, quite simply, is a debit card. The card is issued to the borrower on the MUDRA loan account. The card limit is the working capital portion of the loan.

The borrower is authorized to use the MUDRA card for withdrawals and credits to manage the working capital limit. The card helps in digitizing MUDRA transactions and building credit history for the borrower. The MUDRA card can be used nationwide to withdraw cash from any ATM/Micro ATM and also make payments through any ATM.

In the financial year 2022-2023, provisional figures show that more than 1 crore of MUDRA loans have been sanctioned while approving Rs 73,199 crore as of July 8, 2022. Of this amount, Rs 68,879 crore have been disbursed to beneficiaries .

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