Central Govt Banking,Financial Services and Insurance

Pradhan Mantri Mudra Yojana

Micro-loans up to ₹20 lakh · Shishu/Kishore/Tarun tiers · India non-farm enterprises

Pradhan Mantri Mudra Yojana (PMMY) provides business loans from ₹50,000 to ₹20 lakhs to small businesses, shops, vendors, artisans, and micro-enterprises across India — with no collateral required for smaller amounts. Loans come in four tiers: Shishu (up to ₹50K), Kishore (up to ₹5L), Tarun (up to ₹10L), and Tarun Plus (up to ₹20L for proven borrowers). Apply online at udyamimitra.in or walk into any bank, NBFC, or microfinance institution near you.

Department of Financial Service For: Infra Official Source

About This Scheme

Full official description

Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme of Government of India. The scheme facilitates micro credit/Loan up to Rs. 20 lakhs to income generating micro enterprises engaged in the non farm sector in manufacturing, trading or service sectors including activities allied to agriculture such as poultry, dairy, beekeeping, etc. The Scheme provides financial assistance extended by Member Lending Institutions to the non-corporate, non-farm sector income generating activities of micro and small entities. These micro and small entities comprise of millions of proprietorship / partnership firms running as small manufacturing units, service sector units, shopkeepers, fruits / vegetable vendors, truck operators, food-service units, repair shops, machine operators, small industries, artisans, food processors and others. The loans under Pradhan Mantri Mudra Yojana can be availed through eligible Member Lending Institutions (MLIs), which include:

Public Sector Banks
Private Sector Banks
State operated cooperative banks
Rural banks from regional sector
Micro Finance Institution (MFI)
Non-Banking Finance Company (NBFC)
Small Finance Banks (SFBs)
Other financial intermediary approved by Mudra Ltd. as member financial institutions

Interest rate

The interest rates are declared by Member Lending Institutions from time to time as per Reserve Bank of India guidelines based on which applicable interest rate is determined.

Upfront fee/Processing charges

Banks may consider charging of upfront fee as per their internal guidelines. The upfront fee/processing charges for Shishu loans (Covering loans upto Rs. 50,000/-) are waived by most Banks.

Note :

There are no agents or middleman engaged by MUDRA for availing of Mudra Loans. The borrowers are advised to keep away from persons posing as Agents/ facilitators of MUDRA/PMMY.

Benefits

Shishu: loans up to ₹50,000 (processing fees waived by most banks)
Kishore: loans from ₹50,001 to ₹5,00,000
Tarun: loans from ₹5,00,001 to ₹10,00,000
Tarun Plus: loans up to ₹20,00,000 for successful Tarun borrowers
Available from public sector banks, private banks, NBFCs, MFIs, and small finance banks
No collateral required for Shishu and Kishore loans

💡 Why Startups Should Care

PMMY is India's most widely accessible micro-business loan — the tiered structure (Shishu to Tarun Plus) means you can start with a small ₹50,000 loan and graduate to larger amounts as your business grows, without switching schemes.

Who Can Apply (Eligibility)

Any individual, sole proprietor, partnership firm, private/public limited company, or other legal entity
Must be engaged in non-farm income-generating activities: manufacturing, trading, services, or allied agriculture (dairy, poultry, beekeeping, etc.)
Must not be a defaulter with any bank or financial institution
Satisfactory credit history required
No specific income or educational qualification mandated for most categories
Tarun Plus: must have successfully repaid a previous Tarun loan

How to Apply

Gather ID proof, address proof, and passport photo.
Approach any bank, NBFC, or MFI offering PMMY loans.
Submit business plan and existing financial details (for Kishore/Tarun tiers).
Choose the loan tier matching your business's growth stage.
On approval, receive the loan and a Mudra Card for working capital access.

Frequently Asked Questions

Is Khadi Activity Eligible Under PMMY Loans?

Yes. MUDRA loans are applicable for any activity which results in income generation. As Khadi is one of the eligible activities under Textile sector and in case MUDRA loans are taken for income generation, the same can be covered.

Are MUDRA Loans Available For Purchase Of CNG Tempo/Taxi?

MUDRA loans would be available for purchase of CNG Tempo/Taxi, in case the applicant intends to use the vehicle for commercial purposes.

I Have A Savings Bank Account With the Bank, Would Loan Under MUDRA Be Available Based On The SB Account?

Yes. The applicant can approach the branch and apply for the loan in the format being provided by the said lending institution. The terms and conditions of the loan will be governed by the policies of the lending institution, based on the broad guidelines of RBI. The loan amount will be decided by the requirement of the proposed income generating activity and the repayment terms will be decided by the anticipated cash flow from the activity.

Under PMMY-Shishu Loans, What Is The Turn Around Time For Processing The Loan Proposal?

As per Banking Codes and Standard Board of India (BCSBI), set up by RBI, loan applications should be disposed off for credit limit up to Rs.5 lakh within 2 weeks.

Is It Required To Submit Income Tax Returns For The Preceding 2 Years For Availing Loan Of Rs. 20 Lakh Under PMMY?

Generally, IT returns are not insisted for small value loans. However, the requirement of documents will be advised by the concerned lending institutions based on their internal guidelines and policies.

Ready to apply?

Visit the official government portal to apply for this scheme.

Apply on myScheme.gov.in

Documents Required

Proof of identity (self-attested Voter ID / Driving Licence / PAN Card / Aadhaar / Passport)
Address proof
Passport-size photograph
Applicant's signature proof