BJP promises to double Mudra loan ceiling to Rs 20 lakh: Details here

The Bharatiya Janata Party (BJP) released its manifesto on Sunday promising to double the Prime Minister Mudra loan ceiling to Rs 20 lakh. Under the PM Mudra Yojana (PMMY), over 460 million loans worth Rs 27 trillion have been given so far.

Mudra Yojana aims to encourage entrepreneurship and generate opportunities for livelihood across all segments of society, including the OBC, SC, and ST communities. 

“In past years, Mudra Yojana has turned crores of people into entrepreneurs... Looking at this success, BJP has taken one more ‘sankalp’. Under the Mudra Yojana, loans up to Rs 10 lakh were provided. Now, the BJP has decided to increase the limit to Rs 20 lakh. I am confident this will be used as a new strength towards building the ecosystem required for industry 4.0,” Prime Minister Narendra Modi said while launching BJP’s manifesto for the Lok Sabha elections 2024 on Sunday.

A look at PM Mudra Yojana

The Pradhan Mantri Mudra Yojana (PMMY) was launched in 2015 to facilitate collateral-free micro credit of up to Rs 10 lakh to non-corporate, non-farm small and micro entrepreneurs for generating income.
 

Benefits of PM Mudra loan

It offers the reliability of a government-endorsed scheme.

No collateral required: Borrowers don’t need to provide any security or third-party guarantee.

Competitive interest rates: Interest rates are affordable. The rate of interest is decided by lending institutions in terms of RBI guidelines.

Accessibility: Funds can be accessed easily using a Mudra loan card.

Wide coverage: Available to a range of businesses including vendors, traders, and service providers.

Flexible repayment terms: Designed to accommodate the financial situation of small businesses.

Types of PMMY loans

Shishu: Loans sanctioned under the PMMY scheme up to Rs 50,000. 

Kishore: Loans sanctioned under the PMMY scheme Rs 50,001 to Rs 5,00,000

Tarun: Loans sanctioned under the PMMY scheme Rs 500,001 to Rs.10,00,000

How to apply for PMMY loans

Visit a PMMY-authorised financial institution or NBFC.

Ensure you have a well-documented business plan in hand.

Complete the Mudra loan application form accurately, providing all required details.

Submit the application form along with necessary documents and passport-sized photographs.

Documents required for Mudra loan application

Duly filled application form with recent passport-sized photographs.

KYC documents of the applicant, such as passport, voter’s ID card, driving licence, Aadhaar Card, PAN card.

Relevant documents if the applicant belongs to special categories like SC/ST, or any other specified category.

Proof of business address.
 

Business establishment certificate (applicable for existing enterprises).

Bank statements for the last 12 months.
 

Any additional documents as required by the bank.

Watch: BJP Manifesto, key promises and initiatives