Who is eligible for PM Mudra Yojana?

Any Indian citizen who runs or plans to start a non-farm income-generating business can apply. This includes shopkeepers, street vendors, artisans, small manufacturers, service providers, transport operators, and women entrepreneurs.

What are the Mudra loan categories?

Shishu: up to Rs 50,000 for new or very small businesses. Kishore: Rs 50,001 to Rs 5 lakh for established businesses needing expansion. Tarun: Rs 5 lakh to Rs 10 lakh for well-established businesses. Tarun Plus: Rs 10 lakh to Rs 20 lakh introduced in Budget 2024 for Tarun borrowers with a good repayment record.

Is collateral required for a Mudra loan?

No collateral or guarantor is required for Mudra loans. The government's Credit Guarantee Fund covers the risk for lenders.

Where can I apply for a Mudra loan?

You can apply at any scheduled commercial bank, regional rural bank, microfinance institution, or NBFC. Apply online at udyamimitra.in to connect with multiple lenders at once without visiting a branch.

What is the interest rate on Mudra loans?

Interest rates vary by lender and category. Shishu loans are typically around 10 to 12 percent per annum. There is no fixed government rate, so compare across banks before applying.

PM Mudra Yojana – Business Loan up to ₹20 Lakh Without Collateral

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What is PM Mudra Yojana?

Pradhan Mantri Mudra Yojana (PMMY) was launched on 8 April 2015 to provide institutional credit to micro and small enterprises that lack access to formal banking. It covers non-agricultural income-generating activities — from a vegetable vendor to a small garment unit.

Loans are given through the Micro Units Development & Refinance Agency (MUDRA) via partner banks, microfinance institutions, and NBFCs. No collateral, no guarantor needed.

Four Loan Categories

🌿 Shishu

Up to ₹50,000

For new or very small businesses needing seed capital

📈 Kishore

₹50,001 – ₹5 Lakh

For established businesses needing expansion funds

🏭 Tarun

₹5 Lakh – ₹10 Lakh

For well-established businesses seeking scale-up capital

🚀 Tarun Plus

₹10 Lakh – ₹20 Lakh

For Tarun borrowers with a clean repayment track record

✓ Budget 2024 introduced the new Tarun Plus category, extending Mudra loans up to ₹20 lakh for businesses that have already successfully repaid a Tarun loan.

Who is Eligible?

Any Indian citizen who owns or plans to start a non-agricultural income-generating business can apply. This includes:

Street vendors, shopkeepers, and traders
Artisans and craftspeople
Small manufacturers — food processing, textiles, leather
Service providers — salons, repair shops, tutors
Transport operators — auto-rickshaw, e-rickshaw owners
Women entrepreneurs and Self-Help Group (SHG) members

❌ Agriculture-related activities are not covered under PMMY. However, agri-allied activities like poultry, fishery, bee-keeping, and food processing are eligible.

How to Apply for a Mudra Loan

Visit your nearest bank, RRB, or microfinance institution
All major banks — SBI, Bank of Baroda, Canara Bank, HDFC, Axis — participate. You can also approach a microfinance institution (MFI) in your area.
Choose your loan category
Decide between Shishu, Kishore, Tarun, or Tarun Plus based on how much you need and your business stage.
Fill the application form and submit documents
The form is free. Submit your ID, address proof, business details, photos, and a brief business plan if the bank requires it.
Loan processing — 7 to 30 days
Shishu loans are typically processed within 7–10 working days. Larger loans may take longer as the bank assesses business viability.
Receive funds and Mudra card
On approval, you receive a Mudra RuPay card to withdraw working capital as needed up to the sanctioned limit.

✓ Apply online at udyamimitra.in to submit your application to multiple lenders simultaneously without visiting a single branch.

Documents Required

📄 Aadhaar Card 📄 PAN Card 📄 Voter ID / Address Proof 📄 Passport size photos (2) 📄 Business proof (trade licence / GST) 📄 Bank statement – 6 months (Kishore & above) 📄 Business plan / project report (for larger loans)

* Shishu loans often require minimal documentation. Even a verbal explanation of your business may suffice at some MFIs.

Official Source

All information on this page is sourced from the official PMMY portal and MUDRA Bank.

udyamimitra.in ↗ · mudra.org.in ↗

This page is for informational purposes only. MeraHaq is not affiliated with the Government of India. Interest rates and eligibility vary by lender — always verify at your bank or official portal.

Pradhan Mantri Mudra YojanaBusiness Loan Up to ₹20 Lakh — No Collateral