Image Source : PIXABAY One can get collateral-free loans under the MUDRA scheme.
Pradhan Mantri Mudra Yojana: Pradhan Mantri MUDRA Yojana (PMMY) was launched by Prime Minister Narendra Modi on April 8, 2015 with the aim of empowering non-corporate, non-farm small and micro enterprises by providing loans of up to Rs 10 lakh. MUDRA – Micro Units Development & Refinance Agency – is a financial institution that was set for the development and refinancing of micro-unit enterprises.
MUDRA loans: Categories
MUDRA loans are offered in four categories – Shishu, Kishore and Tarun and Tarun Plus.
MUDRA loans limit
Shishu: It covers loans up to Rs 50,000.
Kishore: It covers loans above Rs 50,000 and up to Rs 5 lakh.
Tarun: It covers loans above Rs 5 lakh and up to Rs 10 lakh.
Tarun Plus: Rs 10 lakh and up to Rs 20 lakh.
MUDRA loan interest rate
There are no fixed interest rates on Mudra Loan (PMMY) and they depend on the nature of the business and the risk associated with it. Generally, the minimum interest rate on Mudra Loan (PMMY) is 9-12 per cent per annum.
MUDRA loans: Features
Here are some of the key features of the PMMY loans –
Collateral-free loans of up to Rs 20 Lakh.
Several banks are not putting processing charges on these loans.
Repayment tenure is between 12 months of 5 years and there is scope for extension in some cases.
No foreclosure charges.
Women entrepreneurs are offered loans at concessional interest rates.
How to get MUDRA loans at an affordable interest rate
If you are planning to avail a MUDRA loan, here are certain things that you should keep in mind to get it at affordable rates.
Maintain a good credit score as it enhances credibility and can help in getting lower interest rates.
Choosing the right MUDRA category is helpful in getting a good interest as each category has a different interest rate.
Present a detailed business plan as it will the confidence of the lender.
Opting for a shorter repayment tenure can result in a lower interest rate.
Before finalizing, it is better to compare lenders.
