What is a Mudra loan? How can I apply for Mudra loan?

What is a Mudra loan? How can I apply for Mudra loan?

Mudra loan is a government scheme. The full form of MUDRA is Micro Units Development and Refinance Agency. The government of India provides this loan to the Indian citizens. 

This scheme was launched by the Prime Minister of India Mr. Narendra Modi on April 8, 2015. This scheme is launched to provide loans to the entrepreneurs of up to Rs.10 lakhs. This loan scheme is for the non-cooperative,non-firms entrepreneurs. 

Read Mudra loan kya hota hai in Hindi

MUDRA Loan Benefits

  • No collateral is required for this loan.
  • This helps the small and new entrepreneurs to build up their business and get financial help from the bank.
  • The mudra loan scheme provides instant loans and hassle free loans to the small enterprises.
  • The processing charge is not asked by the applicant in the mudra loan scheme.
  • This scheme loan can be given in various forms like overdraft facility,term loan,credit loan,etc.
  • The repayment tenure of the mudra loan is up to five years.
  • The use or purpose of the loan is not asked by the bank, the loan amount can be used for any purpose.

MUDRA Loan Types

The mudra loan is of three types. The type of Mudra loan depends upon the amount of the loan. The three types of mudra loan are.

Shishu Loan

The shishu loan under the Mudra loan is for the entrepreneurs who are going to start or planning to start or establish a new business. The maximum amount of the loan is Rs.50,000. This loan includes the financing of the machinery and other business related stuff.  

Kishore Loan

The kishore loan of Mudra loans are for the business men who are wishing to expand their business and searching for funds and financial help for their business expandation. The loan amount limit for this loan is up to Rs.5 lakhs.

Tarun Loan

This type of Mudra loan is for the businessmen who are well settled in the market and established their business in the market perfectly. But they want to develop their business more in the market. The loan amount limit for this type of loan is Rs. 10 Lakhs.

MUDRA Loan Apply

Applying for a Mudra loan is not a big deal. In a few easy steps you can apply for the Mudra loan. Here we have written those steps which will help you to apply for the Mudra loan.

MUDRA Loan Offline

  • Visit the nearest commercial or private bank.
  • Give the hand written business plan to the bank.
  • Then give an Appropriately filled bank application form to the bank.
  • Give all the necessary documents and submit them to the bank.
  • Wait for the verification and approval process.
  • Once the documents are verified then you will get your loan amount in your bank account.

MUDRA Loan Online

  • Visit to the official website of the bank.
  • Search for the Mudra loan Application form and fill up the form.
  • Do not leave any section and fill the form correctly.
  • Submit the form with all the necessary documentations.
  • After the verification and approval process the bank will contact you and do some bank formalities.
  • After all this you will get the loan amount transferred to your bank account.

MUDRA Loan Eligibility

  • The borrower should be an entrepreneur such as a trader, manufacturer, retailer, etc.
  • The borrower should belong to a MSME unit, partnership firm, solo firm, factory, etc.
  • The age criteria for the Mudra loan is 18 years to 65 years.
  • The citizenship of India is necessary.
  • The borrower should have a clean criminal record, which means that they do not have any criminal history.
  • Clear credit score and history.

MUDRA Loan Documents

  • Identity proof of the applicant like aadhar card,ration card, licence, etc is required for Mudra loan.
  • Address proof of the applicant is necessary.
  • Age proof of the borrower is also necessary documentation for the Mudra loan.
  • Current residential address is must for applying for this loan.
  • If the applicant comes under reservation then their caste certificate is necessary.
  • The balance of the past two years is required for the Mudra loan.
  • The previous six months bank statement of the applicant is needed.
  • The income and sales returns of the company or the business is required for applying for Mudra loan.
  • The details of the suppliers of the company is also asked sometimes.

MUDRA Loan Disadvantage

  • Sometimes it becomes a risky investment because it is not clear that the Reserve bank of India is supervising it or not.
  • This is only for small, medium and micro business so the big business do not get the advantage of this scheme.
  • Procedure of the loan could be long or short.
  • Sometimes due to lack of knowledge the entrepreneurs have to face many difficulties in the repayment of the loan amount.
  • The repayment of the loan amount could affect your business.

MUDRA Loan Bank List

NAME OF THE BANKINTEREST RATESREPAYMENT TENURE
SBI9.75% on wardsUp to 5 Years
Bank of Baroda9.65% on wardsUp to 5 Years
Andhra Bank10.50% on wardsUp to 5 Years
Corporation bank9.35% on wardsUp to 7 Years
Bank of Maharashtra8.55% on wardsUp to 5 Years

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