Government to set up Micro Units Development and Refinance Agency (MUDRA) Bank

The Government proposes to set up Micro Units Development and Refinance Agency (MUDRA) Bank for granting loans to small entrepreneurs. The Union Finance Minister in the Union Budget 2015-16 has announced to set up MUDRA Bank through a statutory enactment. A sum of Rs. 20,000 crore would be allocated to the MUDRA Bank from the money available from shortfalls of Priority Sector Lending for creating a Refinance Fund to provide refinance to the Last Mile Financers. Another Rs. 3,000 crore would be provided to the MUDRA Bank from the budget to create a Credit Guarantee corpus for guaranteeing loans being provided to the micro enterprises.