As an entrepreneur, you may have incredible business ideas. You would want to establish your start-up or expand your existing business. Before, financing was a roadblock between you and your business goals. However, that is not the case today. You can get the necessary financing for your business by applying for Business Loans. It is a simple and affordable financing option.
Pradhan Mantri MUDRA Yojana is an initiative by the Indian government to extend affordable financing to micro, small, and medium enterprises. Under PMMY, you can apply for three types of MUDRA Loans: Shishu, Kishore, and Tarun. Every MUDRA Loan offers a decent amount, allowing you to reach your financial goals. Following are more details about MUDRA Loan eligibility.
Decoding the MUDRA Loan eligibility
- All new and existing MSMEs can apply for a MUDRA Loan.
- Any MSME in trading, manufacturing, service sectors, and agriculture-related activities can apply for the Loan.
- Whether you drive a rickshaw, own a bakery, salon, tailoring shop, or electronics/motorcycle repair shop, you can consider MUDRA Loans. You can use the Loan amount to start a business, execute expansion plans, buy machinery, and acquire capital assets.
- The minimum age is 18 years, while the maximum age limit is 65 years.
MUDRA Loan eligible borrowers
The MUDRA Loan eligibility deems the following as eligible borrowers:
- Individuals
- Proprietary concern
- Partnership firm
- Private Limited Company
- Entities for other legal forms
Eligible lending institutions
MUDRA stands for Micro Units Development and Refinance Agency. So, PMMY does not offer Loans directly. Instead, it provides Loans through recognised intermediaries. You can opt for MUDRA Loan apply with the following lending institutions:
- Banks
- Micro financing institutions
- Non-banking financial companies
You can apply with your preferred lending institution offline and online. You need not pledge your assets as collateral to get the Loan. The Loan approval entirely depends on the eligibility criteria mentioned. You can also get a significant Loan amount at a competitive interest rate for a tenure of up to 36 months.
Documents required
You need to submit a set of documents to apply for a MUDRA Loan. Following is a generic list of documents to keep handy:
- MUDRA Loan application form
- Identity proofs
- Address proofs
- Two-passport sized photos
In case of an offline Loan application, submit copies of all documents to the nearest branch. With an online application, you can upload scanned copies of all documents on the bank’s portal. The online application mode is more popular as it is convenient and time-saving