Pradhan Mantri Mudra Yojana

Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme of the Government of India that provides collateral-free loans up to ₹10 lakh (with some coverage now up to ₹20 lakh in recent updates) to non-corporate, non-farm small/micro enterprises in manufacturing, trading, services, and allied agricultural activities.

Scheme Overview

PMMY was launched on April 8, 2015. It aims to “fund the unfunded” by offering affordable credit to micro and small enterprises. The scheme is designed to promote entrepreneurship, generate employment, and encourage inclusive economic growth.

Loan Categories

Loans under PMMY are classified according to the stage of business or funding requirement:

Category	Loan Amount
Shishu	Up to ₹50,000
Kishore	₹50,001–₹5 lakh
Tarun	₹5,00,001–₹10 lakh

Eligible Sectors

PMMY loans can be availed for:

Manufacturing
Processing
Trading
Service sector
Allied activities (like food enterprises, transport, textiles, and community services).

Eligibility Criteria

Any Indian citizen with a viable business proposal for a non-farm income-generating activity in the sectors mentioned above.
Both new and existing micro or small enterprises can apply.
Loans are available through public sector banks, private banks, regional rural banks, cooperative banks, microfinance institutions, and non-banking finance companies (NBFCs).

Key Features

No collateral security required.
No processing fee for Shishu loans (and for larger loans as per individual bank norms).
Quick processing of loan applications.
Repayment tenure can be extended up to 5 years, depending on the nature of the business.
The Mudra Card (a RuPay debit card) is often issued for working capital withdrawal.
Interest rates are as per RBI and bank guidelines and may vary across lenders.

Objectives

Provide financial support to micro and small enterprises.
Encourage first-generation entrepreneurs.
Strengthen credit delivery for the informal sector.
Promote job creation through new enterprises.