Under the Pradhan Mantri Mudra Yojana, the Government of India has introduced mudra loans. Once you indulge in the mudra loan application, you can get help to meet the capital needs of your business. Some of them also take up this loan to manage the operating cost with the help of an easy finance scheme. Those who are running small business enterprises are eligible for the mudra loan.
The mudra loan for women also helps very few women entrepreneurs to carry on with the business operating smoothly. One has to have the following criteria to be able to apply for the mudra loan.
- The minimum age of the borrower should be 18 years, while the maximum age limit should be 65 years.
- The borrowers can handle the loan from any non-farm income-generating business in service, manufacturing, or trading sectors.
- The one engaged in any allied agricultural service from 1st April 2016
Institutions that provide mudra loan
Various lending institutions provide mudra loans. Some of these institutions are:
- Banks which has continuously generated profits during the past few years
- Financial institutions whose net performing assets are not more than 15% for the public, 10% for the private, and 6% for Regional Rural Bank.
- Institutions with a net worth of 250 crore INR for the public and private sector banks and 50 crore INR for the rural banks.
Who are the people that can avail of the Mudra loan?
Under this loan scheme, various entities can take up the advantages of this loan.
- Various vendors and shopkeepers can take up this loan for involving the amount across multiple business activities or non-farming and trading activities.
- With the help of this loan scheme, various textile industries, including khadi work, handloom and knitting industries, can get monetary benefits.
- With the help of mudra loans applied, one can benefit the agricultural sectors.
- Also, business units that provide services to various other communities, including salons and beauty parlours for tailoring shops and medical shops, can take up the mudra loan.
To get the mudra loan, one must have various documents, including passport size photographs, identity proof, income proof, address proof. Along with that, the borrower has to provide the bank statements for the last six months.
Features of mudra loan
The mission of mudra loan apply is to provide financial help to the small and medium business enterprises who developed the economic and social spheres. With this in the head, some of the unique features of this loan include:
- The borrower can take up alone up to 10 lakh INR
- You don’t have to pay the processing fees if you take up the loan under Kishore and Shishu categories. For the Tarun category, A processing fee of 0.5 % of the loan amount is required.
- One should have an existing and new business in non-corporate and non-farming categories.
- The repayment period extends from 3 years to 5 years.
- The government takes the credit guarantee of the borrower. If the borrower cannot repay the loan amount, the government would bear the loss.
One can also take up a mudra loan to purchase a taxi or vehicle to transport small goods. Even people can buy an auto-rickshaw or passenger car. Those who qualify the criteria can get an easy loan up to ten lacs INR. If you want a higher loan amount, you should check for custom lenders who can provide you with easy and quick approval of the loan amount. Whether you are taking the loan for any start-up or any existing business, the borrower first needs to check for the various criteria before a mudra loan apply.