Micro Units Development and Refinance Agency (MUDRA) Ltd. is majorly directed to fund the requirements of all the non-corporate business ventures in India.
Officially launched in the Union budget of India in 2015, the MUDRA loan scheme aims at offering financial assistance to all the small scale businesses and entrepreneurs based in remote areas or somewhere outside regular areas of banking units.
Basic Eligibility criteria
The basic eligibility criteria for Mudra loan is valid for:
  • Small manufacturing units
  • Artisans
  • Vegetable and fruit vendors
  • Shopkeepers
The bank classifies Mudra loan into three broad categories -
  • Shishu loan that enables applicants to get up to INR 50,000.
  • Kishore loan enables applicants to avail up to INR 500,000.
  • Tarun loan enables applicants to avail up to INR 1,000,000.

Benefits of Mudra Loan
  • With the help of Mudra loan scheme, applicants can easily get credit facilities for funding their micro/small enterprises for better income generation.
  • One major benefit of acquiring Mudra loan is that applicants or borrowers don’t have to provide any collateral or security against the loan. Moreover, there are also no processing charges on Mudra loans.
  • There is no minimum loan sum or amount for acquiring Mudra loans.
  • The Mudra loan credit facilities are extended for any type of funding or non-funding requirements. Therefore, borrowers can easily use the available Mudra loan scheme for various purposes. The borrowers can use the credit from Mudra loans for overdraft facilities and term loans or for applying for bank guarantees or letters of credit for any financial institution.