Focus: GS II: Government schemes
Why in News?
As per data uploaded by Member Lending Institutions (MLIs) on Mudra portal, as on 27.01.2023, more than 38.58 crore loans have been extended since inception of the Scheme in April 2015.
About Pradhan Mantri Mudra Yojana (PMMY)
- Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme of Government of India.
- The scheme facilitates micro credit/Loan up to Rs. 10 lakh to income generating micro enterprises engaged in the non farm sector in manufacturing, processing, trading or service sector.
- MUDRA supports Financial Intermediaries to extend loans to the non-corporate, non-farm sector income generating activities of micro and small entities.
- These Micro and small entities comprises of millions of proprietorship / partnership firms running as small manufacturing units, service sector units, shopkeepers, fruits / vegetable vendors, truck operators, food-service units, repair shops, machine operators, small industries, artisans, food processors and others, in rural and urban
The loans under MUDRA scheme can be availed only through banks and lending institutions which include:
- Public Sector Banks
- Private Sector Banks
- State operated cooperative banks
- Rural banks from regional sector
- Institutions offering micro finance
- Financial companies other than banks
Interest rates are charged as per the policy decision of the bank. However, the interest rate charged
to ultimate borrowers shall be reasonable.
The benefits under the scheme has been classified under three categories as ‘SHISHU’, ‘KISHOR’ and ‘TARUN’ to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur.
- Shishu: Covering loans up to Rs. 50,000/-
- Kishor: Covering loans from Rs. 50,001 to Rs. 5,00,000/-
- Tarun: Covering loans from Rs. 5,00,001 to Rs. 10,00,000/-
- Proprietary concern.
- Partnership Firm.
- Private Ltd. Company.
- Public Company.
- Any other legal forms.
The applicant should not be defaulter to any bank or financial institution and should have a satisfactory credit track record. The individual borrowers may be required to possess the necessary skills/experience/ knowledge to undertake the proposed activity. The need for educational qualification, if any, need to be assessed based on the nature of the proposed activity, and its requirement.