Answering the Most Common FAQs About Mudra Loans
Micro Units Development & Refinancing Agency is a financial institution set up by the Indian government to help small and medium-scale enterprises to grow. The idea behind the initiative is to create an entrepreneurship-conducive environment in the country. Under the Mudra Yojana, you can avail of loans at affordable interest rates to meet your business requirements.
Another significant advantage of Mudra Loan is it is collateral-free. This expands your business without risking your assets. Here we answer the most common questions you may have about Mudra Loans.
Who can apply for Mudra Loans?
Mudra Loan eligibility criteria are the simplest of all. If you are an entrepreneur falling in the age group of 18 to 65 years, you can apply for the Mudra Yojana. All enterprises that are non-corporate and non-farming, small and medium scaled enterprises, are eligible for a Loan. Whether you are a shopkeeper or artisan, you can now realize your dream.
How can you avail a Mudra Loan?
You can do so at any nearest Mudra partner institute. Following are the institutes to apply for a Loan:
· Public and private sector banks
· Regional rural banks
· Non-banking financial companies
· Microfinance institution
Submit your application form along with your KYC and financial documents, and your Loan request will get processed soon. Alternatively, you can complete this procedure online.
What are the different Mudra Yojana stages?
Mudra Yojana has three different stages. Each offers a Loan amount ideal to meet the funding requirement of a particular growth stage. Here are more details of the various stages:
· Shishu: Avail of a Loan amount of up to Rs. 50,000. The Loan is ideal for businesses that have just started.
· Kishore: Get a Loan amount between Rs. 50,000 and Rs. 5 lakh. Applying for this Mudra Loan online is a good way to execute your expansion plans.
· Tarun: Avail of a Loan amount between Rs. 5 lakh and Rs. 10 lakh. Opting for this Loan is suitable for carrying out massive expansion projects.
How does Mudra Loan repayment work?
Mudra Loans have a repayment tenure of five years. You can repay your Loan amount through Equated Monthly Installments. No applicants should default payments with any lender.
For what purposes to avail of Mudra Loans?
If you meet the Mudra Loan eligibility criteria, you can apply for Mudra Loans for the following purposes:
· To attain working capital
· To buy a commercial vehicle
· To purchase manufacturing raw materials and machinery