Even an artisan can seek loan under Mudra scheme for a small amount up to Rs. 50,000
There are essentially three finance schemes under the aegis of Mudra
Shishu: This is meant for the diminutive firms with loan requirements of up to Rs. 50,000.
Kishor: The financing through Kishor scheme meets the needs of slightly bigger firms with loan requirements between Rs. 50,000 and Rs. 5 lakh.
Tarun: This caters to the needs of bigger firms that have loan requirements higher than Rs. 5 lakh but less than Rs. 10 lakh.
Mudra’s delivery channel is conceived to be through the route of refinance primarily to banks/ NBFCs/ MFIs.
Practically anyone can access loan under the Mudra scheme. Even a small time artisan can seek loan under the Shishu category through any banks/ MFIs (micro-finance institution)
Even someone who wants to start a boutique, ice cream parlour, pottery business or a food processing unit can access Mudra loans to start a business, says Mudra’s official website.
Eligibility of borrowers: Any Indian citizen who has a business plan for a non-farm income generating activity such as manufacturing, processing, trading or service sector whose credit need is less than Rs. 10 lakh can approach either a bank, MFI or NBFC for availing of MUDRA loans under PMMY.
Mudra credit card: Mudra card is an innovative credit product wherein the borrower can avail of credit in a hassle free manner. It provides a facility of working capital arrangements in the form of CC/OD to the borrower. Mudra card is a RuPay debit card, it can be used for drawing cash from ATM or business correspondent or make purchases using point of sale. The card can also be used to repay the amount, reducing the interest cost.
Interest rate: In the case of banks, RBI has also put a cap on the interest rate at base rate/ MCLR for lending micro units by commercial banks by availing of MUDRA refinance. Similarly, the RRBs (regional rural banks) and cooperatives have been given an interest cap of 3.50 per cent over and above MUDRA refinance rate, while lending to MUDRA loan by availing of MUDRA refinance.
In case of NBFCs, RBI has also stipulated a interest cap of 6 per cent over and above MUDRA refinance while their lending to MUDRA segment.
