About Pradhan Mantri Mudra Yojana (PMMY):
- It is a flagship scheme of the Government of India to extend affordable credit to micro and small enterprises.
- Mudra schemes are designed to bring enterprises into the formal financial system or to “fund the unfunded”.
- It enables a small borrower to borrow from all Public Sector Banks such as PSU Banks, Regional Rural Banks and Cooperative Banks, Private Sector Banks, Foreign Banks, Micro Finance Institutions (MFI), and Non Banking Finance Companies (NBFC) for loans upto Rs 10 lakhs for non-farm income-generating activities.
- Eligibility: Any Indian citizen who has a business plan for a non-farm sector income-generating activity such as manufacturing, processing, trading, or the service sector and whose credit need is less than Rs 10 lakh can approach either a bank, MFI, or NBFC for availing of Micro Units Development & Refinance Agency Ltd. (MUDRA) loans under PMMY.
- Types of loans provided: Under the aegis of PMMY, MUDRA has already created the following products
- Shishu: covering loans up to 50,000/-
- Kishor: covering loans above 50,000/- and up to 5 lakh
- Tarun: covering loans above 5 lakh and up to 10 lakh
- There is no subsidy for the loan given under PMMY. However, if the loan proposal is linked to some Government scheme wherein the Government is providing capital subsidies, it will also be eligible under PMMY.
