InvestorQ : What is the Shishu Pradhan Mantri MUDRA Yojana loan?
Tanya Mehta made post

What is the Shishu Pradhan Mantri MUDRA Yojana loan?

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seema Upadhyaya answered.
1 year ago

MUDRA, acronym for Micro Units Development & Refinance Agency Ltd (MUDRA), is a Government of India-created institution that provides refinancing and several development functions to micro unit enterprises.

MUDRA primarily provides funds to non-corporate and non-farm sector income generating activities of micro and small enterprises whose credit needs are below Rs 10 lakh. All bank branches will provide loans to micro units, sans any collateral.

Based on which stage of growth and funding requirement the micro unit is in, MUDRA has created three schemes that provide loans:

1. Shishu: covering loans up to Rs 50,000

2. Kishore: covering loans above Rs 50,000 and up to Rs 5,00,000

3. Tarun: covering loans above Rs 5,00,000 and up to Rs 10,00,000

The Shishu loan under MUDRA Yojana provides up to Rs 50,000 to those micro unit entrepreneurs who are either in their initial stages of business or looking to start one. Checklist to be provided for availing the Shishu MUDRA Yojana loan: • Machinery quotation and other items to be purchased • Details of the machinery to be purchased

Please note, in addition to the above, borrowers also have to provide details of the machinery supplier.

Furthermore, borrowers also have to provide:

• Certificate of belonging to SC, ST, OBC, etc. • Address proof • Identity proof