Get loan from Mudra Yojana to start a business

How to get loan from Mudra Yojana, Scheme Types, Form, Subsidy, Interest Rate, Application, Online Apply, Eligibility Criteria, Required Documents

The new scheme ‘Mudra Loan Scheme’, implemented by the government, helps people engaged in all small and micro businesses by giving loans financially. With the help of the Mudra Bank Loan Scheme, people no longer need to depend on higher interest rates from a private person or for a loan on someone else. Let us now know in detail about Mudra loan and also know how it can be obtained and in which category the loan is given.

Mudra Loan Scheme

What is Mudra Loan?

The Micro-units Development and Refinance Agency is one of the major units by which a minimum of Rs 50,000 and a maximum of Rs 10,00,000 is given to the start-up enterprises and small business units under the Mudra Loan Scheme from the government. Mudra has partnered with regional and state level banks, and micro finance institutions (MFIs) apart from lending institutions.

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Types of Mudra Loans

Mudra loans can be divided into three different categories according to the loan price, type of business –

  • Shishu Category– Only people with small scale industry can get loan in this category. According to the government’s plan, there is a provision to give loans up to Rs 50,000 to small scale people in this category. This category is for those who want to start their own small scale industry. The person taking the loan has to present his idea i.e. the idea in the bank at that time.

  • Kishore Category– This category is for those people who have already set up their own industry and want to make their business an enterprise. Under this scheme, the price of loan in Kishore category has been kept as minimum of Rs. 50,000 and maximum of Rs. 5,00,000.

  • Tarun Category– According to this category, loans are given to those industries which are already established and they have to do business on a large scale. The price of loan in Tarun category is the highest, because in this category, the maximum loan amount that has been fixed in this scheme, i.e. loan up to Rs 10 lakh is given in it.

Therefore, every bank has its own different criterion in all things like interest rate etc., so that it determines whether or not to give you a loan.

Main purpose of Mudra loan

The main objective of Mudra loan is to get loans at affordable interest rates for people working at small and micro level, so that the burden on agriculture sector can be reduced. This is also the purpose of Mudra loan, that people should become work seekers rather than working within anyone.

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The main function of Mudra loan

Mudra loans are given to shopkeepers, vendors, transport and small industries to find new ways of employment and to provide employment to the unemployed.

  • Mudra loan for shopkeepers and sellers- Those who are not employed in agriculture and do not want to go in agriculture, Mudra loan can open a new business for those people by giving them loans up to Rs 50,000. They get this loan easily.

  • Mudra loan in textile industry- A modern machine like projectile, airjet price starts from 30,00,000 rupees in textile, and it is not easy to install them. But the cost of a handloom is about 5,00,000 rupees, so they can buy it. And with the help of Mudra loan, you can start your own small scale industry.

  • Mudra loan in agriculture- Now modern equipment is also used in agriculture. The work used to be done in the first 2 days in agriculture can be completed in a few hours today. With the help of Mudra loan, a farmer can increase his income by purchasing new equipment.

Mudra Loan Benefits

  • There is no minimum interest amount under Mudra loan. Any eligible person can take a loan ranging from Rs 50,000 to Rs 10,00,000. For that, he has to succeed in all the conditions set by the bank.

  • The applicant is not required to pledge part of the property to avail loan in Shishu category. Because of this, people who had fear of mortgaging their land. Due to this, it has become easier for many people to take loans.

  • Anyone related to agriculture and engaged in other small scale industries can take advantage of this. They can use this loan for pesticides, new equipment, fertilizers etc. With this, farmers will take less time to finish the work and the income will be more.

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Eligibility criteria for Mudra Loan

  • Business owners- Those people who take goods from one place and send it to another place; they need the most money loan. Those who work in this way always need money in the beginning and if there is no money, then they are unable to do their work and their business ends. This kind of problem can be easily solved with the Mudra loan given by the government.

  • Shopkeepers- Many people have an idea to increase their business, but due to lack of money they are unable to do anything and their business is limited to one place. If these people get a loan through Mudra loan, then they can take their business to the heights of the sky.

  • Startup Entrepreneur-When it comes to those people who have to start their new venture, but do not have money. These people provide fresh new opportunities for the youth. These people are like a revolution, start small scale work and develop their businesses.

  • Small producer- These people are small businessmen, who work in a small place, they have work and they can develop their work but due to lack of money they are not able to do so. . If these people get money, then they can come first in their category.

  • People engaged in agriculture- Earlier it used to take several days to tillage a field, but nowadays such tools have come, that you can finish your work very soon. These tools cost more. If the farmers get a loan under the Mudra Loan Scheme, then their work can be completed in a short time and quickly.

Types of banks that offers Mudra Loan

Following are the lending institutions and banks which provide loans under Mudra Loan Scheme –

  • Micro Finance Institute- In this, individuals engaged in small enterprises and small businesses are given loans by MFIs for their businesses. The MFI examines all the documents and finally decides whether the applicant should be given a Mudra loan.

  • Regional Rural Banks- The central government gives 50% of the capital and the respective state government 15% of the capital to the regional rural banks. Then these banks provide Mudra loans to small entrepreneurs and farmers under Mudra Loans.

  • Private Banks- The government has also asked many private banks to give money loans. These banks can choose any procedure for lending, but the interest rates should be covered under Mudra loan only.

  • Small Finance– These banks mainly give money loans to small entrepreneurs, micro enterprises. For a loan of Rs 50,000 or less, nothing has to be pledged in the bank. The need for PAN card has now been ignored and now one can get loan without PAN card.

  • Public Sector Banks- There are also some public sector banks, which can provide loans to people under this central government loan scheme. And the loan amount can range from 50,000 to 10,00,000 rupees.

Required documents for Mudra loans      

Mudra loan is the same method of taking loan, which is done for taking other business loans. Below is the list of important documents without which the loan cannot be taken:

  • Identity cards– The candidates need to produce identity cards such as Aadhaar card, voter ID card, passport, telephone bill etc.,

  • Proof of residence- In order to prove that you are the resident of Andhra Pradesh you need to Aadhaar card, passport, voter ID, telephone bill, bank details etc.

  • Caste certificate- Candidates who belong to backward classes are asked to produce caste certificate in order to prove that you belong to backward class.

  • Passport photo- The candidates are asked to submit recently taken 2 passport size photographs of the applicant for the loan.

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How to apply for Mudra Loan?

For the application, you have to fill a form, which is available on the website of www.mudra.org.in. After downloading the form from there, you fill it. Each bank has its own separate system, under which they give loan to the applicant. You can apply in the bank where your account is already opened.

Facts about Mudra Loan

  • The rate of interest and the process of taking loan can be different from every bank. But the rates of interest fall only in the infant, adolescent and teenage category. But no bank can charge more than the interest rate fixed by Mudra loan.

  • You can repay the loan taken by you anytime in 5 years.

  • Women are given loans under the United Women Entrepreneur Scheme. In this, women who can hold 50% or more shares in the company can apply for loan.

What is a currency card ?

Mudra card is a card given by banks, through which a person who has taken a Mudra loan can withdraw money. Actually, if someone’s Mudra Loan is accepted, then the bank opens that person’s account in the name of Mudra Loan Account and they are provided with Mudra Card. The bank puts the loan amount in that person’s account and then that particular person can withdraw money from his or her Mudra card.   

Mudra loan scheme is a revolutionary scheme of the government, under which the government also wants to include those sections, which the society has ignored. In this scheme, the government gives loans to those youth who have ideas of good business, but cannot use them due to lack of money. With this plan, the aim of reducing the burden of agriculture in the country for so many years is also reduced.

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