Explainer: What is the Mudra scheme, which was mentioned in the President's address..
President Draupadi Murmu addressed both the houses together through a speech before the budget session. Her speech also gives an indication of the state and direction of the government before the budget. In this speech, she discussed many things, in which she put special emphasis on the Mudra scheme and said how this scheme has been very beneficial for small businessmen. It is working well, it is useful.
Let us know what this scheme is. How does it work? How much money has been given to small businessmen through this? Also, know what problems are usually faced in taking a loan under this scheme.
What is Mudra Yojana
MUDRA Yojana is a major scheme launched by the Government of India, which aims to provide financial assistance to small and medium enterprises (MSME). It is also known as Pradhan Mantri Mudra Yojana (PMMY). This scheme helps small businessmen to become self-reliant by giving them financial assistance. Those starting a small business can take advantage of it.
When did it start
It started on 8 April 2015. Its goal is to provide easy loans to micro, small, and medium enterprises (MSMEs). In this scheme, loans are provided by various banks, NBFCs (non-banking financial companies), and microfinance institutions.
Who gets its benefit?
This scheme was started for non-corporate small businesses. Its benefits are available to small shopkeepers, handicraftsmen, fruit/vegetable vendors, small factories, transport services, etc.
How much loan is given under Mudra Yojana
Three types of loans are given under Mudra Yojana
Shishu Yojana – Loan up to ₹50,000 (for starting a small business)
Kishor Yojana – Loan from ₹50,000 to ₹5 lakh (for business expansion)
Tarun Yojana – Loan from ₹5 lakh to ₹10 lakh (for large-scale business)
Who can take advantage of the Mudra Yojana?
What is the specialty of this scheme
– Loan without guarantee
– Low interest rate
– Special benefits to women entrepreneurs
– Simple process of repaying the loan
How to apply for it
– Go to the nearest bank branch and apply for a Mudra loan.
– Online application can also be done from the bank's website or the official website of Mudra Yojana
– Documents like Aadhar card, business plan, bank statement, GST number, etc. are required
How much loan has been given so far
Under the Pradhan Mantri Mudra Yojana (PMMY), a total of 62,310,598 loans were sanctioned till March 31, 2023, with a sanctioned amount of ₹4,56,537.98 crore, and the disbursed amount is ₹4,50,423.66 crore.
How much interest is charged in this
Talking about interest rates, interest rates on Mudra loans may vary according to the bank and the category of loan. For example, in the State Bank of India (SBI), an interest rate of one year MCLR (Marginal Cost of Funds Based Lending Rate) + 2.75% is applicable.
Usually, the interest rate on a Shishu loan (up to ₹50,000) can be up to 10-12%, which is slightly higher.
However, interest rates may vary depending on the bank, loan amount, and applicant profile.
What are the problems in taking this loan?
There are some challenges in taking advantage of this scheme.
1. Difficulty in loan approval
– Banks and financial institutions do not give loans easily to all applicants.
– Many times the application is rejected, especially when the credit score is not good.
– New business people find it difficult to get a loan without a guarantee.
2. Complicated documentation process
– Many small traders are not aware of the required documents (business registration, GST number, income certificate, etc.).
– Loan application may be rejected due to incomplete documents.
3. Disagreement of bank personnel
– Many banks are not interested in giving small loans as they do not get much profit from them.
– Bank officials may sometimes ask for personal guarantees or additional documents, which are not necessary as per the rules.
4. High interest rate
– In some banks and NBFCs, the interest rates of Mudra loans are relatively high.
– Paying the interest rate can become a challenge for small traders.
5. Loan limit
– Most small entrepreneurs want to take a loan of more than 10 lakhs, but the maximum limit in the Mudra scheme is only Rs 10 lakh.
– This fund is not sufficient for large business expansion.
6. Problems in loans for women entrepreneurs
– The government promotes women entrepreneurs, but many times women face problems in loan approval because they do not have much property or credit history in their name.
7. Lack of awareness
– Many small traders in rural areas are not aware of this scheme.
– Middlemen or agents collect money from people by giving wrong information.
Disclaimer: This content has been sourced and edited from News 18 hindi. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
