The purpose of Pradhan Mantri Mudra Yojana is to provide funding to the non corporate small business sector. Loans worth about Rs 1 lakh crore have already been sanctioned to small entrepreneurs under the Pradhan Mantri MUDRA Yojana.
Prime Minister Narendra Modi says, the government wants youth to be job creators and not job seekers.
Eligibility for Pradhan Mantri Mudra Yojana:
- Individuals and Small business units, both are eligible. Your business plan should be non farm income generating activity in manufacturing and services sector; whose credit requirement is less than 10 lakhs.
- You name should not be in any financial institution’s default list in respect of loans availed earlier.
The purpose of Pradhan Mantri Mudra Yojana:
Pradhan Mantri Mudra Yojana aims
- to provide fund based Working capital
- and, Term loans for all business purposes.
The Pradhan Mantri Mudra Yojana loans are eligible under 3 categories:
- Shishu Loan, which cover loans upto 50,000/-
- Kishore Loan cover loans above 50,000/- and upto 5 lakhs
- And, Tarun which cover loans above 5 lakhs and upto 10 lakhs
The total Exposure of Maximum upto Rs.10 Lakhs can be given to any eligible unit or Customer as per above mentioned three categories.
- For loan upto Rs.50000, margin and processing charges are NIL.
- And, for loan of Rs. 50,001 – Rs. 10 lacs, margin is NIL, but, processing charges of 0.50% of Loan amount is applicable. In addition, Service Tax will be charges as per applicable rates.
- Also, Other charges as applicable. For latest applicable charges, please contact bank.
Interest Rates are linked to Base Rate (BR at 9.30%)
• CGTMSE covered accounts – BR+200 bps i.e. 11.30% pa (As on 10.03.2016)
• And, for Non-CGTMSE accounts – BR +230 bps i.e. 11.60% pa (As on 10.03.2016)
In addition, for updated rates, please contact nearest branches of PSU banks.
- You will get a guarantee cover under CGTMSE guarantee scheme; only if your business activity is Manufacturing and services.
- And, retail trade is not eligible for CGTMSE coverage
- Primary Security is Hypothecation of stocks, machinery and movables acquired out of Bank’s finance.
- Especially relevant is that Collateral security is not required as per RBI guidelines for all loans upto Rs. 10 lakhs extended to units in the MSE Sector.
- If you have a Working Capital loan, then you will have to Repay the loan amount on demand. That means, whenever bank demands, you will have to repay. To be more precise, you need to keep paying the monthly interest if you have a working Capital facility.
- And, you will have to repay your Term Loan in 3 – 5 years including your moratorium of upto 6 months.