Modi Government Offering Loans Up to ₹20 Lakh at Low Interest Rates, Find Out Which Banks Are Providing This Facility
The Narendra Modi government is providing a significant financial boost to aspiring entrepreneurs through the Pradhan Mantri Mudra Yojana (PMMY). Under this scheme, people can avail of collateral-free loans up to ₹20 lakh at affordable interest rates to start or expand their businesses. The announcement was made by Finance Minister Nirmala Sitharaman during the Union Budget 2024-25, where she increased the loan limit to ₹20 lakh. This new limit came into effect on October 24, 2024.
What Is Pradhan Mantri Mudra Yojana (PMMY)?
PMMY is designed to support small businesses and entrepreneurs by providing financial assistance. These loans are collateral-free, making them accessible to a wider group of people, including those without assets to pledge. The scheme has been instrumental in helping individuals set up their own businesses.
The scheme is categorized into four types based on the loan amount:
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Shishu: Loans up to ₹50,000
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Kishore: Loans ranging from ₹50,000 to ₹5 lakh
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Tarun: Loans ranging from ₹5 lakh to ₹10 lakh
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Tarun Plus: Loans ranging from ₹10 lakh to ₹20 lakh
Which Banks Are Providing Mudra Loans?
The Mudra loan is offered through Member Lending Institutions (MLIs), including:
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Scheduled Commercial Banks
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Regional Rural Banks (RRBs)
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Small Finance Banks (SFBs)
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Non-Banking Financial Companies (NBFCs)
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Microfinance Institutions (MFIs)
These banks provide collateral-free loans to entrepreneurs who are looking to start or grow their small businesses.
A Decade of Mudra Yojana’s Success
The Mudra Yojana was launched a decade ago and has proven to be a game-changer for many entrepreneurs. The scheme has helped in the creation of over 52 crore loan accounts, leading to a rise in entrepreneurial activities. A significant achievement of the scheme is the increase in the number of women beneficiaries, which now account for 68% of the total recipients. Additionally, between FY 2016 and FY 2025, the disbursed amount per woman borrower has seen a year-on-year increase of 13%, amounting to ₹62,679.
How the Scheme is Helping Entrepreneurs
The Mudra Yojana has paved the way for countless entrepreneurs to start and expand their businesses, creating job opportunities and contributing to economic growth. The increase in the loan limit to ₹20 lakh is expected to provide further momentum to small businesses in the coming years.
