Pradhan Mantri Mudra Yojana (PMMY): Starting a small business often requires financial support, especially for first-time entrepreneurs. To help people become self-reliant and promote small businesses nationwide, the Government of India launched the Pradhan Mantri Mudra Yojana (PMMY).
This scheme offers collateral-free loans to small business owners, self-employed individuals, and entrepreneurs seeking to start or expand their businesses.
What is Pradhan Mantri Mudra Yojana?
Pradhan Mantri Mudra Yojana is a government-backed loan scheme that offers financial assistance to micro and small enterprises. Under this scheme, eligible applicants can get loans ranging from ₹50,000 to ₹10 lakh without providing any security or guarantee.
The main objective of PMMY is to encourage entrepreneurship, create employment opportunities, and support small businesses in both urban and rural areas.
The loans under Pradhan Mantri Mudra Yojana can be availed through eligible Member Lending Institutions (MLIs), which include:
- Public Sector Banks
- Private Sector Banks
- State-operated cooperative banks
- Rural banks from the regional sector
- Micro Finance Institution (MFI)
- Non-Banking Finance Company (NBFC)
- Small Finance Banks (SFBs)
- Other financial intermediaries approved by Mudra Ltd. as member financial institutions
Types of Mudra Loans
Mudra loans are divided into three categories based on business needs and stages:
- Shishu Loan
- Loan amount: Up to ₹50,000
- Suitable for new and very small businesses
- Kishor Loan
- Loan amount: ₹50,000 to ₹5 lakh
- Ideal for businesses looking to grow or expand
- Tarun Loan
- Loan amount: ₹5 lakh to ₹10 lakh
- Designed for established businesses planning major expansion
Eligibility Criteria for Mudra Loan (PMMY)
Eligible Borrowers
The following individuals and business entities are eligible to apply for a loan under the Pradhan Mantri Mudra Yojana (PMMY):
- Individual entrepreneurs
- Proprietorship concerns
- Partnership firms
- Private Limited companies
- Public Limited companies
- Any other legally recognized business entities
Who Can Apply for a Mudra Loan?
The scheme is open to a wide range of applicants, including:
- Indian citizens aged 18 years and above
- Small business owners and self-employed individuals
- Shopkeepers, street vendors, and hawkers
- Tailors, electricians, plumbers, mechanics
- Salon and beauty parlour owners
- Food stalls, tea shops, and small eateries
- Online sellers and home-based businesses
- New as well as existing businesses
Large companies and corporate entities are not eligible under PMMY.
Documents Required for Mudra Loan
Applicants usually need the following documents:
- Aadhaar Card
- PAN Card or Voter ID
- Address proof
- Passport-size photographs
- Bank passbook
- Business details or a simple business plan
- Trade license (if available)
For new businesses, banks generally accept a basic business plan.
Interest Rate and Repayment
- No collateral or security is required
- Interest rates depend on the bank or financial institution
- Loans are repaid through easy monthly EMIs
- Repayment tenure varies based on loan amount and bank policy
How to Apply for Mudra Loan
Applicants can apply either online or offline.
Online Application:
Visit the official website: https://www.mudra.org.in
Offline Application:
Apply at nearby:
- Government banks
- Private banks
- Regional Rural Banks
- NBFCs and microfinance institutions
Benefits of Pradhan Mantri Mudra Yojana
- Collateral-free loans
- Simple application process
- Financial support for small businesses
- Encourages self-employment
- Supports the vision of Atmanirbhar Bharat
- Helps turn business ideas into reality
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