Pradhan Mantri Mudra Yojana 2015 - Fund the Unfunded Pradhan | UPSC Notes EPFO Labour Law
Pradhan Mantri Mudra Yojana 2015 - Fund the Unfunded
Pradhan Mantri Mudra Yojana (PMMY) is a flagship program of Government of India to “fund the unfunded” basically through this scheme financial institutions like Micro Finance Institutions (MFIs), Non-Banking financial Companies (NBFCs), Small Finance Banks, RBRs, Commercial Banks, Cooperative Banks etc. will provide loans at very low rate to the new Ideas or Startups and people having a business plan in a Non-Farming Sector with Income generating activities.
Objective of Pradhan Mantri Mudra Yojana
★ To sanction loans up to rupees 10 Lakhs to those who have a business plan or new idea to generate income but don’t have enough capital to invest. Provided the plan should be of non-farming activity and which can promote manufacturing, processing, trading, or service sector.
★ To create new sources of employment and increase the overall GDP of India.
★ With the help of establishment of MUDRA bank, the network of microfinance institutions will be monitored and new registration will also be done.
★ Integration of Informal economy into Formal sector as incomes from the informal sector are non-taxed.
Types of Loans Provided
The Pradhan Mantri Mudra Yojana (PMMY) has three type of loans scheme as per the funding requirements or idea of the Beneficiary or the Entrepreneur.
1. Shishu : covering loans upto 50,000/-
2. Kishor : covering loans above 50,000/- and upto 5 lakh
3. Tarun : covering loans above 5 lakh and upto 10 lakh
There is no subsidy for the loan given under PMMY. However, if the loan proposal is linked with some Government scheme, wherein the Government is providing capital subsidy, it will be eligible under PMMY also.
Sectors covered under Pradhan Mantri Mudra Yojana
★ Land Transport Sector : - Loans provided to the beneficiary to support the purchase of transport vehicles. These vehicles could be used for goods or personal transport such as auto rickshaw, small goods transport vehicle, 3 wheelers, e-rickshaw, passenger cars, taxis, etc.
★ Textile Sector :- Loans provided to support micro textile industries that produce garment and non-garment products like Handloom and power loom industry, Handwork industry which works on embroidery, chikan work, dyeing and printing, knitting, etc.
★ Service Sector :- This includes community services, social services, or personal services such as saloons, beauty parlors, gymnasium, boutiques, tailoring shops, dry cleaning, cycle and motorcycle repair shop, DTP and Photocopying Facilities, Medicine Shops, Courier Agents, etc.
★ Food Product Sector :- This include small scale food activities such as papad making, achaar making, jam / jelly making, agricultural produce preservation at rural level, sweet shops, small service food stalls and day to day catering / canteen services, cold chain vehicles, cold storages, ice making units, ice cream making units, biscuit, bread and bun making, etc.
How to apply for MUDRA loan
Entrepreneurs, who wish to avail assistance under Pradhan Mantri MUDRA Yojana (PMMY), can approach the local branch of any of the financial institutions mentioned above, in their region or locality and submit the required documents and application form to avail the benefits.
PMMY Eligibility Criteria
1. To avail of the benefits of the PMMY Scheme, the person should be a citizen of India.
2. Must come up with a plan or business idea related to sectors like Manufacturing, Processing, Trade, Service Sector or any other fields whose credit demand is less than ₹10 lakhs.
The Borrower seeking MUDRA Loans under the PMMY Scheme can approach either a Micro Finance Institution, Bank or NBFC to avail it.
