Pradhan Mantri Mudra Loan Yojana 2024: Required Documnets , Eligiblity Criteria and Benefits

The Pradhan Mantri Mudra Loan Yojana (PMMY) is an important government program started by Prime Minister Narendra Modi to help people start their own small businesses and be self-employed in India. Under this plan, people can get loans from Rs 50,000 to Rs 10 lakh to start or grow their small businesses.

One of the key things about the Pradhan Mantri Mudra Loan Yojana is that it gives loans to small business owners without asking for any security. This article will give you all the details you need about the required documents, eligibility criteria, and benefits of the scheme. This will help you understand how you can use this chance to make your business dreams come true.

Overview of Pradhan Mantri Mudra Loan Yojana

The Pradhan Mantri Mudra Loan Yojana (PMMY) was officially started on April 8, 2015, by the Government of India. The main goal is to help people across the country start their own businesses and be self-employed. This important scheme wants to support the growth and development of small businesses by giving them easy access to loans they can afford.

The Micro Units Development and Refinance Agency (MUDRA), a public sector financial institution, is in charge of carrying out the Pradhan Mantri Mudra Loan Yojana. Under this plan, loans are given out by various lending institutions such as banks, Non-Banking Financial Companies (NBFCs), and Microfinance Institutions (MFIs) that are registered with MUDRA.

Scheme NameLaunch DateObjective
Pradhan Mantri Mudra YojanaApril 8, 2015Promoting self-employment and entrepreneurship

Types of Loans under Pradhan Mantri Mudra Loan Yojana

The Pradhan Mantri Mudra Loan Yojana has three different types of loans to meet the various financial needs of small businesses at different stages of their growth. These loan types are called Shishu, Kishore, and Tarun, each for a specific range of loan amounts.

  1. Shishu Loan: This type provides loans up to Rs 50,000 to help support businesses that are just starting out.
  2. Kishore Loan: Under this category, loans from Rs 50,001 to Rs 5 lakh are given to businesses looking to grow and expand their operations.
  3. Tarun Loan: The Tarun loan category is for well-established small businesses seeking higher loan amounts between Rs 5,00,001 and Rs 10 lakh for further growth.

Interest Rates and Repayment Terms

The interest rates for loans under the Pradhan Mantri Mudra Loan Yojana are set by the lending institutions and may vary based on factors such as the loan amount, the borrower’s credit profile, and the type of business. Usually, the interest rates range from 8% to 12% per year, which is relatively lower compared to other unsecured loans available.

In terms of repayment, the Mudra loan scheme offers flexible options to borrowers. The loan repayment period can be up to 5 years, giving borrowers enough time to establish and grow their businesses. In some cases, lending institutions may also offer a moratorium period of up to 6 months, during which borrowers don’t have to make any principal repayments. This gives them an initial break to focus on running their business.

How to Apply for Pradhan Mantri Mudra Loan Yojana

The application process for the Pradhan Mantri Mudra Loan Yojana is made to be simple and easy, with both offline and online options available for borrowers. Those who like the traditional method can go to their nearest bank or financial institution and submit a physical application form along with the required documents. The offline application process involves the following steps:

  1. Offline Application: Borrowers can get the Mudra loan application form from their chosen bank or financial institution. They need to fill out the form with correct information and attach all the required documents. Once the application is complete, borrowers can submit it to the designated officer at the bank or institution for further processing.
  2. Online Application: For tech-savvy borrowers, the Pradhan Mantri Mudra Loan Yojana also offers an online application option. Interested applicants can visit the official website of the scheme at and go to the online application portal. They need to fill out the digital application form, providing all the necessary details and uploading scanned copies of the required documents. Once submitted, the online application will be processed by the selected lending institution.

Eligibility Criteria for Pradhan Mantri Mudra Loan Yojana

To get the benefits of the Pradhan Mantri Mudra Loan Yojana, applicants must meet certain eligibility requirements. The scheme is open to many types of businesses, including individuals, proprietary concerns, partnership firms, private limited companies, and other organizations involved in manufacturing, trading, or service sectors.

One of the main requirements for eligibility is that the applicant must be an Indian citizen. Also, the business seeking the loan should be involved in non-farm income-generating activities. The minimum age limit for applicants is 18 years, making sure that the scheme supports adult entrepreneurs in their efforts.

Required Documents for Pradhan Mantri Mudra Loan Yojana

To apply for a loan under the Pradhan Mantri Mudra Loan Yojana, applicants need to submit some important documents that prove their identity, residence, and business ownership. These documents help lending institutions determine if the applicant is eligible and trustworthy. Here is a list of the main documents needed for the Mudra loan application process:

  • Proof of identity: Applicants must provide a valid government-issued identity proof such as an Aadhaar card, PAN card, or Voter ID.
  • Proof of residence: Documents like an Aadhaar card, utility bills, or rental agreement can be used to prove the applicant’s current residence.
  • Proof of business ownership/registration: Depending on the type of business, applicants may need to submit registration certificates, licenses, or other relevant documents.
  • Bank statements: Applicants must provide bank statements for the last 6 months to show their financial history and cash flow.
  • Passport-size photographs: Recent passport-size photographs of the applicant are needed for identification purposes.
  • Quotations of machinery/equipment: If the loan is for buying machinery or equipment, applicants should submit relevant quotations or invoices.

Benefits of Pradhan Mantri Mudra Loan Yojana

The Pradhan Mantri Mudra Loan Yojana has many benefits for borrowers, making it a good choice for those looking for financial support for their small businesses. One of the biggest advantages of this scheme is that it provides loans without collateral. This means borrowers don’t have to pledge assets as security, making it easier to get credit.

Also, the interest rates under the Mudra loan scheme are usually lower compared to other types of loans available. This helps reduce the financial burden on borrowers and allows them to use more money for growing their business. Plus, the scheme has a simple documentation process, making it easier for applicants to go through the loan application and approval stages.

The Pradhan Mantri Mudra Loan Yojana plays an important role in creating self-employment opportunities and encouraging entrepreneurship in the country. By providing financial support to small businesses, the scheme empowers people, especially youth and women, to follow their business dreams and contribute to the nation’s economic growth. The loans offered under this scheme can be used for various business purposes, such as meeting working capital needs, buying machinery or equipment, and helping with business expansion plans.

Success Stories of Mudra Loan Beneficiaries

The Pradhan Mantri Mudra Loan Yojana has changed the lives of many entrepreneurs across the country, helping them turn their dreams into reality. Here are a couple of inspiring success stories that show the impact of the Mudra loan scheme:

Example 1: Rajesh, a skilled craftsman from a small town in Rajasthan, always dreamt of starting his own handicrafts business. However, lack of money kept his dreams on hold. Through the Mudra loan scheme, Rajesh got a loan of Rs 3 lakh, which allowed him to set up a workshop and buy the necessary raw materials and equipment. Today, his business is doing well, and he employs several artisans from his community, contributing to the local economy.

Example 2: Sneha, a young woman from a rural village in Maharashtra, had a passion for organic farming. With the help of a Mudra loan of Rs 1.5 lakh, she was able to lease a plot of land and invest in essential farming tools and supplies. Sneha’s hard work and dedication paid off as she now successfully grows and sells organic produce to local markets and restaurants, earning a stable income and supporting her family.

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The Pradhan Mantri Mudra Loan Yojana has emerged as a game-changer in the realm of small business financing, providing aspiring entrepreneurs with the necessary financial support to pursue their dreams. By offering loans without collateral at affordable interest rates and with minimal paperwork, the scheme has removed the barriers that once hindered the growth of small businesses in India. The success stories of Mudra loan beneficiaries prove the transformative power of this initiative in fostering self-employment and driving economic growth at the grassroots level.

If you are an aspiring entrepreneur looking to start or expand your own business, the Pradhan Mantri Mudra Loan Yojana could be the key to unlocking your potential. To learn more about the scheme and how to apply, visit the official website at or contact the Mudra helpline at 1800-180-1111 or 1800-11-0001. Don’t let a lack of funds hold you back from achieving your entrepreneurial dreams. Seize the opportunity provided by the Mudra loan scheme and start your journey towards self-reliance and success.

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