Get loan upto Rs 10 lakh for your business, here is how to benefit from Modi govt's scheme

New Delhi: The ongoing COVID-19 crisis and the consequent lockdown has led to severe disruption of business for micro and small enterprises. But thanks to Modi Government's MUDRA loan initative, now you can get loans upto Rs 10 lakh for your business.

What is MUDRA loan?

Under Pradhan Mantri Mudra Yojana (PMMY), Mudra loan is extended for a variety of purposes which result in income generation and employment creation like loan for vendors, traders, shopkeepers and other service sector activities.

From where can you get MUDRA loan?

PMMY loans are extended by Member Lending Institutions viz. Scheduled Commercial Banks, Non Banking Finance Companies and Micro Financial Institutions, registered with Mudra Ltd.

Get loan upto Rs 10 lakh for your business under Mudra loan

Under the Pradhan Mantri Mudra Yojana (PMMY), Scheme by banks and Micro Finance Institutions (MFIs) Loans are extended in three categories:

Shishu (loans upto Rs. 50,000);

Kishore (loans from Rs. 50002 to Rs. 5 lakh);

Tarun (loans from Rs.5 lakh to Rs. 10 lakh)

In May this year, the Union Cabinet gave approval for additional funding of up to Rs 3 lakh crore to MSMEs and interested MUDRA borrowers by way of "Emergency Credit Line Guarantee Scheme." Under the Scheme, 100 percent guarantee coverage will be provided by National Credit Guarantee Trustee Company Limited (NCGTC) for additional funding of up to Rs 3 lakh crore in the form of a Guaranteed Emergency Credit Line (GECL) facility. A corpus of Rs 41,600 crore shall be provided by the government spread over the current and the next three financial years. The Cabinet also approved that the Scheme would be applicable to all loans sanctioned under GECL Facility during the period from the date of announcement of the Scheme to October 31, 2020, or till an amount of Rs 3,00,000 crore is sanctioned under the GECL, whichever is earlier. 

Meanwhile, Finance Minister Nirmala Sitharaman on November 12, announced 12 key measures, as part of Government’s stimulus to the economy, under AatmaNirbhar Bharat 3.0. FM announced Emergency Credit Line Guarantee Scheme for MSMEs, businesses, MUDRA borrowers and individuals (loans for business purposes), has been extended till March 31, 2021.