The Union government’s main initiative to promote self-employment is the Pradhan Mantri Mudra Yojana (PMMY). Collateral-free institutional lending up to ₹10 lakhs under PMMY Registration.
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PMMY Registration
The Union government’s main initiative to promote self-employment is the Pradhan Mantri Mudra Yojana (PMMY).
Member Lending Institutions (MLIs), which include Scheduled Commercial Banks (SCBs), Regional Rural Banks (RRBs), Non-Banking, Financial Companies (NBFCs), and Micro Finance Institutions (MFIs), provide collateral-free institutional lending up to ₹10 lakh under PMMY.
An initiative called PMMY lends money to MSEs engaged in trading, manufacturing, processing, or service industries up to Rs. 10 lakh. Through Micro Units Development and Refinance Agency Ltd. Banks and other lending institutions, as well as (Mudra), an arm of SIDBI (India’s Small Industries Development Bank), provide the funds.
Pradhan Mantri Mudra Yojana Amount
The program provides three different loan kinds:
- Shishu (loans up to ₹50,000)
- Kishore (loans above ₹50,000 And Up to ₹5 lakh)
- Tarun (loans above Rs. 5 lakh and up to Rs. 10 lakh).
To grow their operations, already-existing small firms may also make use of financing facilities offered at affordable interest rates.
How to apply for Pradhan Mantri Mudra Yojana?
Applying for PMMY is easy and quick. The steps are:
- Visit the official website www.udyamimitra.in of PMMY or Udyamitra and click on “Apply now”.
- Choose the kind of loan (Shishu, Kishor, or Tarun) and then enter your personal information (name, address, phone number, email address, PAN card, Aadhaar number, etc.).
- Choose from “New Entrepreneur,” “Existing Entrepreneur,” and “Self-Employed” from the available choices.
- Please provide the “Name of the Applicant,” “Email ID,” and “Mobile Number” while registering for the first time.
- Create an OTP, then register.
- Include scanned versions of any necessary papers, such as identification, an address proof, a company registration, a project report, a business strategy, etc.
- Apply and note down the reference number for future reference.
- The application will be forwarded to the nearest branch of the selected lender for verification and approval.
- The lender will contact the applicant and conduct due diligence such as site visits, credit appraisals, etc.
- If approved, the loan amount will be disbursed to the applicant’s bank account within a stipulated time.
Pradhan Mantri Mudra Yojana Eligibility
The candidate has to be an Indian citizen. Anybody who meets the other requirements and has a small business plan is eligible to apply for a loan under the Scheme.
He or she may apply for loans under three different loan packages for income-producing ventures in the manufacturing, trade, and services sectors as well as for agricultural-related operations.
The candidate shouldn’t have a track record of defaulting on loans. PMMY loans are available to any person or organization involved in non-farm revenue-generating activities. Among the requirements for qualifying are:
- The candidate must have a clean credit history and not be in arrears with any bank or financial institution.
- The candidate must possess the abilities, background, or expertise required to carry out the suggested task.
- A legitimate identification and address document should be provided by the applicant.
- A project report or business strategy for the suggested activity should be provided by the applicant.
- The applicant’s company must be operating for at least three years.
- The ideal age range for the entrepreneur is between 24 and 70 years old.
Categorization of Mudra loans
The Indian government provides small business owners in need of funding with mura loans. Based on the stage of the business and the required loan amount, these loans are divided into three categories:
- Shishu loans: These are small business loans, usually up to Rs. 50,000.
- Kishor loans: These are loans that range from Rs. 50,000 to Rs. 5 lakhs and are appropriate for long-standing businesses.
- Tarun loans: Loans between Rs. 5 lakhs and Rs. 10 lakhs are known as “Tarun loans,” and they are intended to help firms grow and scale.
Benefits of Pradhan Mantri Mudra Yojana
PMMY assists MSEs in expanding their enterprises and attempts to integrate them into the official financial system. Here are a few advantages of PMMY:
- There are no upfront fees or processing fees associated with the loans, and they don’t demand collateral.
- The lenders’ policies dictate that the loans be offered at fair interest rates.
- Based on the MSES’s finance requirements and development stage, the loans are divided into three categories: Shishu (up to Rs. 50,000), Kishor (Rs. 50,001 to Rs. 5 lakh), and Tarun (Rs. 5 lakh to Rs. 10 lakh).
- The loans may be used for several things, including purchasing raw materials, machinery, equipment, and working capital.
- There are many ways to get loans: cooperative banks, regional rural banks, C-sector banks, private sector banks, microfinance organizations, non-banking financial companies, etc.
- Borrowers may apply online and check the progress of their loans using the web-based portal known as Udyamitra, which is used to monitor the loans.
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